The Truth About Debt Management

By: Dave Ramsey
Submitted: 2007-01-17 16:15:21
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Myth: The debt management companies on TV, like AmeriDebt, will save me.
Truth: You may get out of debt, but only with your credit trashed.

Debt management companies are springing up everywhere. These companies help "manage" your debt by taking one monthly payment from you and distributing the money among your creditors, with whom they've often worked out lower payments and lower interest. This is not a loan as with debt consolidation. Sometimes people get the two confused. However, because America needs serious debt help, the debt management business has become one of the fastest-growing industries today.

Companies like AmeriDebt and Consurmer Credit Counseling Service can help you get better interest rates and lower payment...but at a price. When you use one of these companies and then try to get a Conventional, FHA, or VA loan, you will be treated the same as if you had filed Chapter 13 Bankruptcy. Mortgage underwriting guidelines for traditional mortgages will consider your credit trashed, so don't do it. Real debt management help is found only in changing your behavior.

In short, debt management companies are out. Hard work is in. Change your financial behavior and change your life...for good. True debt management is about one thing: you controlling your money.

Real Debt Management
The good news is that there's not some magical, mystical formula to good debt management. The solution is common sense and having a plan. Grandma's simple way of handling money. Real debt management is 80 percent behavior and 20 percent head knowledge. It isn't rocket science as some debt managment companies try to make you believe.

Is it easy? No. In fact, it's really hard most of the time. But it's worth it. It's amazing to see people change their lives through simple determination and having a plan that works...every time. Once you have a real debt reduction plan in place, it's only a matter of time.

We have people every week e-mail or call us about how they have paid off $10k, $20k, sometimes even $100,000 in debt. Now, you may be thinking, "Yeah right. They must be making six figures to do that." NO! These are just people who are serious about getting out of debt. Many of them are making $30,000 to $50,000 when they decided to be debt-free. It's all a matter of attitude. We call it "gazelle intensity." For over 10 years, we've been teaching people how to beat debt and build wealth.

This content is provided by DaveRamsey.com and may be used only in its entirety with all links included. Dave Ramsey is changing the face of America by helping people beat debt and build wealth with his best-selling book, The Total Money Makeover, and nationally syndicated radio show, The Dave Ramsey Show. Read more of what Dave says about debt management companies and living debt free.

Article source: Expert Articles

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