Christian Debt Consolidation Versus Christian Debt Relief

Everybody seems to have credit cards. The credit card companies make it real easy to acquire a card now. You can apply online and have an answer in less than a minute. If you have decent credit, you can probably get about any card you want.

But with the credit cards comes a dark, sinister, evil thing called credit card debt. This is a particularly dangerous type of credit because it is unsecured.

This means that the card issuer does not have collateral.
For instance, with a mortgage, the loan is secured with the house. If you can't make the payments, the bank forecloses and takes the house to satisfy the debt.

For the Christian, this poses a question of whether it is biblically proper to either consolidate debt or use a debt relief solution. Here is a comparison of the two for you to make an informed decision.

Christian debt consolidation

Based on Christian values and ideas, Christian debt consolidation is very simple. You enter into an agreement with the debt consolidation company. The company negotiates your debts for you and settles on an amount that is usually less than the original amount owed.

If you figure what you would have paid back in aggregate if you had continued with the minimum payments, this is a significant savings. You can actually repay approximately 20% of the total amount of ALL the payments you would have made. Not the outstanding balance owed, but the total of all payments that would have been made over time.

Once the consolidation company settles the amount with your creditors, they make a loan to you and you make one payment to the Christian debt consolidation company.

They then disburse the monies to your creditors and you can be debt free in as little as 24 to 36 months.

Christian debt relief

This is a little different from debt consolidation. Christian debt relief is when you work with a mediator who negotiates your debt down to less than you owed to begin with. This can be as much as 40% of the balance owed. This is also called debt negotiation.

Is it ethical? Of course it's ethical and legal as well. You see, the credit card company makes their money from interest rates. The longer you owe them, the more interest they get.

This is all done by Christians with biblical ideals in mind. There is nothing wrong with Christian debt relief, consolidation or negotiation. All get you out from under the weight if debt while keeping your name in as good a position as possible.

The good thing about both of these methods is that it reflects positively on your credit report. The company you choose to represent you requires the creditors to show your accounts as "satisfied" or "paid in full" on the credit bureaus as soon as they are paid off.

In this way, you can repair your credit rating along the way. Later, you will be able to buy a car or house with no problems.