Best answer from question by Nicole D:
Answer by MoneyMonkey
Try the only reputable company, Consumer Credit Counseling. But, before you do this read Dave Ramsey’s book, Total Money Makeover. Debt consolidation is equal to filing for bankruptcy on your credit report. You can manage your debt if you just get on a written budget, get rid of the credit cards, and start living within your means. Read the book, and get a plan, then pay off your debts in an organized way as described. If you can go through FInancial Peace University, it’s a great way to get control of your finances.
Best answer from question by nealmobley:
Answer by bdancer222
If the debt has already been charged off and sent to collections, the damage is already done. Paying it off won’t help your score. It will remain on your credit report for the balance of the 7 year reporting period whether paid, settled, or unpaid. However, creditors look at your whole credit report, not just the score. Paid old debt always looks better.
Define “debt consolidation”. The term seems to be used for several completely different things. If you are talking about talking out a big loan to pay off all the debts, you probably will have problems qualifying with all the charge off/collection accounts.
If you are talking about a debt management program where you pay a company to pay your debts monthly, make sure the company you use is a NFCC member: http://www.nfcc.org/. There are a lot of scam companies that take your money and never pay any of your debts. However, if you are already in collections for most of your debt, a NFCC credit counseling service probably won’t be able to help.
You could try saving up and negotiating settlement offers with the accounts in collections. Work on them one at a time starting with the newest. Lump sum offers get the best deals. Payment plans have to be short term. Get any settlement agreement in writing and don’t give the collector direct access to your bank account.
