Often times, people with good intentions consider consolidating their debt into a smaller more manageable payment as a way to finally get out of debt. With the multitude of commercials touting the ability to save thousands of dollars in interest and lower your monthly payment, it seems too good to be true, and it is.
The fact is that the debt consolidation companies are eager to "work with you" because they make money off of the consumer. The monthly payment is smaller but the overall amount paid to credit card companies, banks, and then the debt consolidation company is more than the amount of the original loan. The truth is the payment term is extended which lowers the monthly payment obligation.
This is a "buyer beware" to those well-meaning consumers who may fall wary to the tactics of debt consolidation companies in this economy.
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