Debt consolidation can help you pay off credit card debt faster. It offers low or zero percent interest payments and allows you to clear your balances in one lump sum. Our partners at ConsumerAffairs researched the best debt consolidation companies in Baltimore to help you choose the right debt relief for your financial situation.
The need for debt consolidation and settlement in Baltimore
The total amount of credit card debt in America increased over five percent in 2017, with more than 41 percent of people carrying a balance every month. On average, Baltimoreans have credit card debt equaling roughly 11 percent of their income, which is about the national average, but higher than the rest of Maryland.
Average credit card debt
Average household income
Average credit card debt as a percentage of income
If you have high-interest credit card debt, especially spread across multiple cards, debt consolidation can help lower your monthly payments and enable you to pay off your debt faster.
What is debt consolidation?
There are two main methods of debt consolidation: debt consolidation loans and low-interest balance-transfer credit cards. You’ll need good credit to qualify for both. A debt consolidation loan is a new loan that is used to pay off your credit card debts in full while you make monthly payments on the new, lower interest loan. A balance transfer credit card allows you to transfer all of your high-interest credit card debt to a low-interest card, which you then have to pay off in full within a specified time limit.
Benefits of debt consolidation
If the interest rate on the new debt consolidation loan is lower, you pay less money overall
Your credit card debt will be paid off immediately
Your credit score won’t be negatively affected as long as you keep your credit card accounts open after you pay down the debt
Drawbacks of debt consolidation
You must have good enough credit to qualify for a low- or no-interest credit card or loan
Debt consolidation loans and credit cards have to be paid off within a specific time period, so your monthly payments will be higher in the short-term
Doesn’t prevent you from getting back into debt in the future
If your total debt is more than 50 percent of your income, or you’re facing potential bankruptcy, you’re unlikely to get approved for debt consolidation. The Federal Trade Commission has information about other options available for people in this predicament.
If you pursue debt consolidation in Baltimore, make sure to read the Maryland regulations for reputable debt management companies so you don’t end up in worse financial shape.
National Debt Relief offers a range of options for debtors, including debt consolidation, debt settlement and credit counseling. Their website provides information about state laws and statistics in Maryland, and they’re a licensed Debt Management Services (DMS) provider.
For debt relief solutions, CreditAssociates works to settle debt in 24 to 36 months. Good credit is not required and customers get a free, no obligation consultation by speaking to trained advisors who are experts in negotiating down debt. Customer reviews speak highly of agents for being professional, helpful and communicative.
Accredited Debt Relief is a debt management service provider with debt consolidation and debt settlement options. They offer free consultations to determine which method would work best for you. Negotiators will work to lower your debts and no fees are charged until your debts are resolved.
Freedom Debt Relief provides debt settlement, primarily designed for people with a large amount of debt that exceeds their monthly budget, although they don’t offer debt consolidation loans. Their blog contains a lot of helpful information.
Pacific Debt is a debt settlement company that does not offer debt consolidation as one of their options. Though they offer debt counseling, their primary method of debt relief is debt settlement, which is different from debt consolidation.
Debt Rx works with those having credit card debts of $7,500 or more. This debt settlement company is smaller than competitors to focus on individual service and solutions for debt relief. If you’re behind on bills, Debt Rx could be the right prescription to ease the financial pain of being in debt.