While it’s very important that you get a handle on your debt, you should know that how you go about doing it is just as important!

Many households carry big misconceptions related to debt consolidation and credit management. Today, we will be debunking some of the biggest and common myths surrounding debt consolidation plans:

1. Debt management and credit counseling programs are all the same. 

False! Credit counseling involves helping people develop a budget and the discipline to make stead payments in order to clear their debt. You’re simply given the tools you need to put yourself in a better place financially. A debt management program is different as it’s just one tool within a credit counselor’s toolkit. When you enter into a debt management program, you will have someone who takes your monthly lump-sum payment and distributes it to your creditors until your accounts are at zero, then those accounts are usually closed.

2. Credit counselors can cut your monthly payments in half.

Not true! This is a numbers fudging claim that holds true only in the narrowest of circumstances. Consider this example: if you miss two $200 payments on a $10,000 balance, the third month’s bill will make it $600 that you owe. While the credit counselor may say that they’ve re-aged that bill, knocking your payment amount back to $200, you still haven’t escaped anything — the missing money was merely tacked back onto the total owed.

If you have more money than that or you own your own home, a different option would likely be better for you. Learn more about your options to consolidate your debt in our comprehensive debt consolidation overview.

Here at Blue Pearl Mortgage Group, we can help you with your debt consolidation in BC, Saskatchewan, Alberta, Manitoba and Alberta. Our experts here at Blue Pearl Mortgage Group are ready to help you today. Give us a call to see if debt consolidation in Vancouver is right for you.