How Non Profit Debt Consolidation Works

If you’re in debt you’ve probably heard of people using non profit debt consolidation services to help bring their debt under control. Perhaps you’ve even wondered whether non profit debt consolidation is right for your situation. If so, then read on.

What does non profit debt consolidation mean?


A company that advertises itself as a non profit debt consolidation service provider has to comply with certain federal and/or state laws before it can be designated as a “non-profit.” Companies with such designation are funded primarily through voluntary contributions. That’s why you’ll often see non-profits offering their services for “free.” Voluntary contributions come from the company’s clients – you and all other individuals seeking debt relief – and from the creditors with which the non-profit conducts its business.

What is particularly appealing about companies that provide non profit debt consolidation services is that debtors don’t have to pay for the services they receive. That makes sense since people in debt already have more bills than they can afford!

What’s offered by non profit debt consolidation providers?


If you’re behind on bill payments, or unable to make more than the minimum amounts due each month, or your financial situation is going to change soon and make it difficult to meet your debt obligations, non profit debt consolidation services can probably help. Here’s a rundown of the types of services these companies provide.

Regardless of the non profit debt consolidation company you choose, confidential counseling is always the first step. The company needs to understand your current financial situation before it’ll be able to help. Counselors look at your budget and your income and from there put together a debt management plan.
The plan likely will include negotiating with your creditors. During negotiations, non profit debt consolidation counselors might succeed at getting your interest rate lowered, or they might negotiate a reduced payoff amount. Their ultimate goal is to adjust the terms of repayment in a way that benefits you.

The benefits of using non profit debt consolidation services


The benefits are many. Once your counselor has succeeded in negotiating repayment with your creditors, you can soon expect an end to the persistent and oftentimes harassing phone calls from creditors. That alone is a welcome relief!

Non profit debt consolidation counselors also often succeed at reducing or eliminating creditors’ excessive fees and penalties that only put you further and further into debt.

Even better, the debt management plan your non profit debt consolidation counselor implements allows you to start rebuilding your credit. Rebuilding credit takes time, but by reversing the downward slide and making payments as negotiated, you’re that much closer to having the type of credit history lenders prefer.

Best of all, you’ll be debt-free before you know it! If you stick to the terms of your debt management plan, pay more than required whenever possible, and stop incurring new debt, you’ll repay your obligations faster than you ever thought possible. And that is how so many people benefit from non profit debt consolidation services.