Credit management is nothing but the act of determining, setting, legally granting, managing, and paying credit. It is also known as credit restructuring or credit repair. Credit management comprises a number of activities. These activities include debt settlement, debt relief, and reduction of credit balances.
Debt settlement is an agreement in which the creditor and the debtor have decided to reduce the total debt amount payable to each other through negotiation. The debt settlement agreement is entered into by the creditor and the borrower after due consultation of the two parties. The process of debt settlement involves various stages like introduction of revised loan agreement, collection of funds from the borrower, disbursement of funds to the creditors, and finalization of the debt settlement terms. The debt settlement agreement is signed by the creditor and the borrower on the date of the signing of the agreement. The purpose of debt settlement is to get rid of the financial situation of the borrower in very affordable manners.
After the implementation of debt management program, credit scores remain negative for a limited period of time. Due to this reason debt management leads to debt relief. This is possible because the creditors to recover their money from the borrowers instead of the other way round, that is they recover only the late fees charged by them.
Debt relief leads to reduction of the monthly payments and improves the credit score ratings. Debt settlement also has a similar impact on the credit score ratings. After the implementation of debt management program, the monthly payments are brought down so that they become affordable. Once your monthly payments become affordable, you will be able to pay off the debt balance in easy installments.
In case of credit score ratings, debt settlement also has an advantage. Debt consolidation reduces the credit score ratings but it also provides debt relief. Debt consolidation helps the customer to make only one monthly payment that is easier to manage. It also provides debt relief.
The most important thing in debt consolidation is that debt consolidation does not provide debt relief programs and debt management program that can lead to the improvement of the financial situation. Debt consolidation can help you manage your monthly payments and the debt balances in a better manner. However, debt consolidation does not lead to the improvement of the financial situation. It is advisable that you go for debt consolidation only when you have no other option left aside, said the best debt relief help provider in all of Louisiana.