The non profit debt consolidation company receives a fair share of the money paid to the agency by the debtor, and it is this share that is the primary means of support for the non-profit group. On the other hand, the profit debt consolidation company does not get this share of the money from the debtor. However, this fair share percentage has dropped to such a low amount nowadays that it hardly makes any difference. Instead, the debtor is given the same minimum monthly payment with an interest reduction whether he or she uses a non-profit or for-profit debt consolidation company.



Whether you choose a for-profit or non profit debt consolidation company to consolidate your debts, the services provided by both are basically the same. They both offer a debt consolidation loan to repay your numerous loans with this single loan. The benefit here lies in the fact that the debt consolidation company gets their experts to negotiate with your creditors to lower the interest rates of your loans. This gives you the lowered monthly payment that the debt consolidation company advertises about. So instead of you having to individually handle all your creditors, the debt consolidation company's experts handle them. Sometimes the experts can also get the creditors to reduce the amount of the loan.

There are basically two types of debt consolidation loans offered; secured loan and unsecured loan. The secured loan needs collateral that may be seized by the debt consolidation company if you fail to repay their loan. The unsecured loan has no collateral but usually offers higher rates and lends you a smaller amount than you requested for.

Of course, in return for all this service that the debt consolidation company offers you, they will be getting a percentage of earnings as monthly fees. Fees usually range between 29 to $69 per month, depending on the number of creditors the company has to handle.

When choosing the right debt consolidation company, choose wisely. Just by having non-profit all over their advertisements does not mean that you have a better deal here; you get the same monthly payment and interest reductions, whether the firm is non-profit or for-profit. Some firms may claim to be non-profit but without even looking at the interest rates of your debtors, advise you to get a loan that may be of a higher interest rate than your individual loans.

So on the whole, neither company is better. It is up to you to get debt consolidation quotes from different companies, and to compare quotes. Do some math yourself to anticipate how much loan you need to take to repay your loans, and compare this with the quotes. Then you choose the debt consolidation company that quotes reasonable rates that best fits your budget and needs.