Debt Consolidation Not For Profit?
From our contact page the other day we were asked if we could recommend a nonprofit debt consolidation company. The short answer to the question is that there is no such thing as debt consolidation not for profit.
Of course there are companies out there that might call themselves non-profit debt relief companies. These companies may offer a range of services from consolidation loans to debt settlement, or even bankruptcy services. The problem is that they may call themselves non-profit companies, but most likely you’re being misled.
When it comes to debt consolidation specifically there are really two types of companies out there. There are those who lend you their own money and those who borrow money from others and relend it to you. In either case there is interest charged on the supposed nonprofit consolidation loan that you take out, and fees are usually charged for acquiring the loan itself. Herein, of course, lays the problem.
The consolidation company calls itself non-profit, but they still collect interest on the loan, and they do profit from that interest. In many cases they pay out huge salaries to the directors of the company so that can maintain their non-profit status.
The qualifications to become a nonprofit organization in the US aren’t really that strict. Basically all you need to do to get nonprofit status is create a company that doesn’t specifically earn money (it was created as a corporation, but not intended to profit as a corporation). That’s not to say that they can’t spend a huge amount of money on expenses.
In other words, the term nonprofit, when it refers to debt companies is usually just a marketing gimmick. Â The same can be said about nonprofit debt negotiators, and most other offshoots in the debt industry. Â The companies are still going to earn money for their services; they just hide that money by paying it out to someone else.
Debt Consolidation Not For Profit – A Better Solution
With a brief look at what debt consolidation not for profit really means (not much at all), it’s time to talk about a better solution. Since your goal of a consolidation loan, or a debt relief program, is to get out of debt – a much better option to being misled by a company who calls themselves nonprofit is to find an experienced debt relief company. On the front page of our site you’ll find consumer-backed reviews of the top three debt relief companies in the US.
