My girlfriend has $5000 in credit card debt and a $30,000 student loan. Her average interest rate on the credit cards is 20%+, because she couldn't afford to pay on time. Her minimum monthly payments on the credit cards and student loan amount to $750/month, more than 1/3rd of her income, which is $2000/mo. We live in Los Angeles, and it costs a lot more than $1250 for standard living expenses.
She'd like to find a way to economically pay down her debt without completely destroying her credit (which is already bad). What are her best options in the Los Angeles area? I'm very skeptical of using some of these credit counseling services, as many appear to be scams that will hurt your credit even more.
By signing up a debt counseling session, your provided details (Name, Email ID and Phone No.) will be forwarded to the company advertising on the DebtCC. However, you have no obligation to use their services.
Some creditors and collection agencies refuse to lower the payoff amount, interest rate, and fees owed by the consumer.
Creditors/collection agencies can make collection calls and file lawsuits against the consumers represented by the debt relief companies.
Debt relief services may have a negative impact on the consumer's creditworthiness and his overall debt amount may increase due to the accumulation of extra fees.
The amount which the consumer saves with the use of debt relief services can be regarded as taxable income.