If you are lucky and you can actually get a consolidation loan then your other accounts are paid off and usually closed and that means this source of “credit’ is gone and all that is left on your credit report is this large loan that you are paying off.

Loans… don’t mean credit since you already spent the available credit and are only paying back.
A loan actually reduces your ability to take on “credit” because you must spend a fixed amount of your income to pay off your monthly loan obligation therefore you have less money available to spend on other things, including a monthly minimum payment towards an unsecured line of credit.
This is how a lender looks at you…. how much do you have left after you pay the big bills and what are the chances you will actually pay back the unsecured line of credit?

The more loans you have…. the less likely you will get a decent line of credit.

What you are telling your lenders when you seek credit card debt relief is that you no longer can make those payments and are now at risk of not paying anything at all. As soon as they find out about it you will see your lines of credit reduced and that means up to the balance you are carrying.
You could find yourself “maxed” out on all cards and that is an automatic hit to your credit score.

Get a second job and stop using the cards until you can get the balances down to a manageable level. Making only the minimum payment due is not going to reduce the debt. Your new credit card statements should show how much you need to pay a month to pay off your debt within 3 years.
Start looking into doing exactly that. It isn’t that much more than your minimum payment but it is a start and 3 years is something most people can deal with.

Stop trying to get a free ride and pay your debts.

The Negative to credit counseling is that while your credit score itself will usually not be negatively effected by enrolling in a credit counseling program, your ability to establish new credit, or any use of existing credit for that matter, will be abolished. Throughout the duration of the program, it is unlikely that you will be able to qualify for a home loan, car loan, or any other credit.it is hard to get a loan or credit card during this period. Also, although interest rates are usually (but not always) lowered for consumers in credit counseling programs, the monthly payments typically will stay the same as your minimum payments, and sometimes more. That means, for consumers that are truly struggling or unable to make their minimum monthly credit card payments, this option will not provide cash flow relief.

With Debt Relief, the debt settlement company can help people that are truly struggling with credit card debt, by representing them in negotiations with creditors to secure settlements of anywhere between 40-60% of the amount of debt owed (at time of enrollment). Of the debt relief options, debt settlement is the least expensive, and shortest in length, with most debt settlement programs averaging between 24-48 months in length.

The Negatives to debt relief include negative marks on your credit for up to seven years. Also, most creditors will report the forgiven debt as income and will send you a 1099c form. You have to report this as additional income on your taxes which would increase the amount of taxes you owe on your tax return.

Here is an article that can help you in your search. It is a review of a company I personally used. I was in a simillar situation as you and they where able to help me pay off my debt in 2 years. My credit rating actually went from the mid 500s to a 680. My debt to income ratio was reduced to nearly nothing which was the main reason for the increase, but they also assisted in removing negative marks on my credit and unlike debt consolidation, or debt settlement, I don’t have to worry about any negative marks following me around for the next 7 years. Thanks to them, I was able to get a loan for a home (just in time before the $8000 tax credit ended…phew).

Good Luck!!

It is important to understand that in a credit counseling program, you are still repaying 100% of your debts — but with lower monthly payments. On average, most credit counseling programs take around five years. While most credit counseling programs do not impact your FICO score, being enrolled in a credit counseling debt management plan does show up on your credit report, and, unfortunately, many lenders look at enrollment in credit counseling akin to filing for Chapter 13 Bankruptcy — or using a third party to re-organize your debts.

Debt Settlement:
Debt settlement, also called debt negotiation, is a form of debt consolidation that cuts your total debt, sometimes over 50%, with lower monthly payments. Debt settlement programs typically run around three years. It is important to keep in mind, however, that during the life of your debt settlement program, you are not paying your creditors. This means that a debt settlement solution of debt consolidation will negatively impact your credit rating. Your credit rating will not be good, at a minimum, for the term of your debt settlement program. However, debt settlement is usually the fastest and cheapest way to debt freedom, with a low monthly payment, while avoiding Chapter 7 Bankruptcy. The trade-off here is a negative credit rating versus saving money.

Although there are many forms of debt consolidation, many people with good to perfect credit who own homes should look into debt consolidation loans, while consumers with high credit card debt and poor credit may want to explore debt settlement or debt negotiation. However, each consumer is different, so find the debt consolidation option that fits for you.

Lastly, here are some fast tips for your own quick Debt Consolidation Evaluator:
1. If you have perfect credit and have equity in your home — consider a Mortgage Refinance.
2. If you can afford a healthy monthly payment (about 3 percent of your total debt each month) and you want to protect yourself from collection and from going delinquent — consider Credit Counseling.
3. If you want the lowest monthly payment and want to get debt free for a low cost and short amount of time, AND you are willing to deal with adverse credit impacts and collections — then evaluate Debt Settlement.
4. If you cannot afford anything in a monthly payment (less than 1.5 percent of your total debt each month) — consider Bankruptcy to see if Chapter 7 might be right for you.

Bills.com makes it easy for you to apply for traditional forms of debt relief.

I hope this information helps you Find. Learn & Save.

Best,
Bill
http://www.bills.com/blog/

Just keep in mind that debt settlement is not an appropriate and right method and should be the last option for the user. The program is planned for people under severe debt problems who are badly in need of credit card debt relief.

In the end, everything will be up to you.

It is possible to get out of debt in less then 36 months, but you have to know what your doing. Throwing your debt over to just any company can hurt you in the end, especially if they are just in it for the fees. I always say “YOU got yourself in to debt, but YOU can get yourself out.” You just might need a little help along the way.
Best of luck.