Columbia, Maryland (PressExposure) March 13, 2009 -- The National Financial Awareness Network, Inc., released an article today in which company president John Janney explains how consumers pay for non-profit as well as for-profit debt relief options, specifically focusing on the similarities and differences between consumer credit counseling and debt settlement.
In the article, titled "Credit Counseling Costs Consumers More than Debt Settlement," Janney explains how both credit counseling and debt settlement service providers collect fees from consumers and how credit counseling ultimately costs consumers more money.
"Credit counseling services are paid through fair-share donations, which are calculated as a percentage of how much the service can collect from consumers," explained Janney. "So, ultimately, the consumers are paying for the service and often end up paying far more than they would pay through a debt settlement program."
Janney pointed out that consumer credit counseling and debt management plans are designed for consumers who can afford to repay 100 percent of their debt while debt settlement is designed for consumers who can only partially repay their debt due to financial hardship. In the current economic downturn, Janney expects to see more consumers seeking partial-payment settlements to clear their debts, but adds that he also expects banks to welcome these settlements.
"Banks are reporting massive losses and bank failures are expected to exceed 100 this year," Janney continued. "Debt settlement is a way for banks to recover some funds that would otherwise have been lost if their customers file for bankruptcy, which is increasingly likely in our current economy."
The National Financial Awareness Network is a Maryland-based personal finance publishing company that offers educational products and services, such as the popular Do-It-Yourself Debt Settlement Kit (http://www.diydebtsettlementkit.com/), Debt Relief University ([http://www.debtreliefuniversity.com/]), Help For Debtors online support forum and their How to Get Great Credit e-book (http://www.nfan.com/credit). For more information, please visit the NFAN website at http://www.nfan.com/.