Debt Consolidation Companies

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Reputable debt consolidation

What - Definition
Debt Consolidation Companies - popular term for an organization that offers or facilitates debt consolidation services. Strictly defined - debt consolidation companies are for-profit corporations. However, because non profit status is widely held by organizations operating in the debt and consolidation arena, the term "debt consolidation companies" is often used to mean any organization that can offer or facilitate one or more debt service:

  • Loan
  • Plan / Program
  • Settlement

The decision to use a debt consolidation company is an important one.

debt consolidation company

Before you begin the selection process you should gain some understanding of the types of debt consolidation company that you are likely to encounter and of some of the potential pitfalls.

Types - Debt Consolidation Companies

There are various types of organization operating in the debt consolidation marketplace.

1. For Profit Debt Consolidation Companies - A Company/Agency - Loan, Plan/Program, Settlement.

2. Other Companies For Profit - Law Firm Specialized - Plan/Program, Settlement (also Bankruptcy alternative).

3. "Non Profit Debt Consolidation Companies" - An Organization/Agency - Plan/Program, Settlement.

4. Non Profit Credit Counseling Agency - An Organization/Agency - Plan/Program.

Tip  Non Profit refers to the organization's tax status only. It does NOT mean free, and it does NOT guarantee affordable, genuine, quality or approved.

The Gray Area - Non Profit Debt Consolidation Companies

Many debt consolidation companies are recorded with the IRS as having non-profit 501(c)(3) status. There are genuine operators of this type, however, there are "Debt Consolidation Companies" or organizations/agencies who abuse this status as a means to make profit. How? They make no profit technically - because it becomes the owner/s salary! The IRS has clamped down on some such debt consolidation companies by denying this status. You should not be persuaded in your choice of debt consolidation company simply because of this status.

You should understand that, in some (but not all) cases, "nonprofit" is deliberately marketed as a tactic to win confidence in a service that is overpriced or even fraudulent. This is why we call it "the gray area" - because it may not be obvious as to profit motivation or credibility.

AKA - Debt Consolidation Companies By Name

Organizations of types 1-3 above come by a variety of different names. Often the name of the debt consolidation company is prefixed by the word "debt" or "credit". The debt consolidation company name might also contain for

example: "Counseling" "Relief", "Solutions", "Service" "Christian", "Free", "Advice", "Help", "Management".

It is important to emphasize that you should not categorize your understanding of an organization type, or the type of service offered - based on name alone. Reputable debt consolidation companies are quickly clear as to exactly what service/s they provide and draw clear distinction on their website. Most reputable debt consolidation companies will actually help you understand service alternatives, even if they do not offer them. Ask yourself: what is this organization type? What service option are they providing? Is this a reputable company choice?

To get yourself clear on this - see our summary of Debt and Consolidation options, which includes a jargon buster aka (also known as).


Why use debt consolidation companies to help with your problem when you may be able to arrange things yourself?

  • Good debt companies offer networking and support and
  • Good debt companies provide resources to help further.
  • Reputable debt consolidation companies offering Plan/Program and Settlement options should have skilled negotiators on staff; skills that you may not possess.
  • Debt consolidation companies typically have a strong relationship with creditors and can negotiate better terms where this is required.
  • Where the loan option is relevant, you may have no other source available other than through a debt consolidation company lender.


  • There are many genuine quality providers however; there are also many unscrupulous and bad actors in the industry. Proper research here and understanding will help you avoid them. 
  • Your likely to be dealing with them for some time, before debt is cleared.


Watch Out For

  • High or hidden fees.
  • Fraudulent actors.
  • High pressure sales.
  • Loan brokers or middleman services; any borrowing should be done from a direct lender.

Credit Card Debt Consolidation Company

The consolidation options for dealing with this type of debt are: Loan, Plan/Program and Settlement. You do NOT need to find a specific "Credit Card Debt Consolidation Company" to help. Any of the above debt consolidation companies types are relevant - when you have decided on one consolidation option.

Payday Loan Debt Consolidation Companies

Payday (unsecured) loans may, or may not be eligible for a Plan/Program alternative. Even if they are eligible, such a lender may be unwilling to participate in the plan. Payday loan debt consolidation companies are therefore in practice any debt consolidation company lender who will payoff this debt, as part of a new loan agreement with them.

Free Debt Consolidation Companies List?

You'll find that most debt company lists do not differentiate the debt company service type, contain both reputable and not so reputable providers and are often outdated, empty or useless. Next we identify the best debt consolidation companies and the way to go about things sensibly.

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