Debt consolidation non profit organizations have been around for sometime now.  Even though in general they have come to be associated with the term debt consolidation, they do not work the same way a debt consolidation loan works.  Their approach to dealing with the issue of debt is more of a debt negotiation, debt reduction, take over your payments approach.  They are akin to organizations that advertise their services with the terms debt settlement and debt management.

Debt consolidation non-profit organizations do not make loans so you can consolidate your debt into one payment.  Instead, what they do is have you bring them all of your financial information for review.  Once they review your financial information and debt situation, they will let you know if they can help you.  What I mean by that is, you have to have a secure ongoing means of income, if you don’t, they can’t help you.  The reason being is they work on helping you come up with a budget for living expenses and a plan for paying back your creditors.  Once these two items have been established, they will contact your creditors and try to renegotiate the terms of your credit cards or loans.

Much of the time these organizations are able to accomplish the following:

• They make an effort to reduce or freeze the debt amount. 

• They also work on eliminating or reducing the interest rate on your accounts.

• They negotiate a lower monthly payment on each account.

•  They negotiate a stop to over limit and late fees.

In theory, you can accomplish the same thing as they do with your creditors.  The difference is, most creditors are more willing to work with a professional organization that has a good reputation and a long-standing history.  They seem to be less flexible when dealing directly with the customer. 
  

Once the new terms have been worked out with your creditors, usually, your overall debt payment will be reduced.  From that point on, you will end up making one payment to the debt consolidation non-profit organization and they will in turn make the monthly payments to your creditors.  That is how most of these debt consolidation non profit organizations work.  Keep in mind that if your late making your debt payment to the organization, or if you can’t make the payment, the whole thing completely falls apart and your account with the organization is terminated.  You’re back on your own!

One of the most notable and reputable non-profit organizations available to help you is Consumer Credit Counseling Service.  I actually used their services several years ago to help me get out of debt.  Even though they are a non-profit group, there are minimal fees associated with their services.  At the time of this writing, there is a one-time fifty-dollar fee for setting up your account.  There is also a monthly fee; the monthly fee is eight percent of your proposed payment, not to exceed thirty-five dollars.

Consumer Credit Counseling Service is truly a not-for-profit organization.  If you’re considering using this type of debt consolidation over a debt consolidation loan, be aware that not all organizations that advertise themselves as non-profit are truly non-profit.  There are many debt consolidation non profit companies out there; just make sure you have a legitimate one.

For more information on debt consolidation follow these links:  Debt Consolidation or Consolidate Consolidation Debt.