On the face of things, it always sounds very simple, doesn’t it? You take out a loan and make a single monthly payment. The money you then borrow pays off all those niggling debts in one go, but of course, you still have to find the money to pay off the loan?
But the reality can be so different and can actually get you into more trouble than you started off with if you go about this process the wrong way!
This article will look at the various aspects of debt consolidation in the hope we can give you the correct advice so you can make a fresh start! We’ve already explained very simply what a debt consolidation loan is but they can come in many different forms of course!
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Debt Consolidation Loans
These are designed to reduce the pressure you could be feeling from creditors. And let’s be honest if you weren’t you wouldn’t be human. But what you should remember has they often spread the debt over a much longer period of time, meaning you may be in debt for many years.
If your existing debts have high interest rates, you could get a loan with a lower rate but you’d need to be in the right place at the right time. If you have high levels of debt, banks may only offer you a loan with a higher rate of interest. In fact, this will generally be the case.
They can actually avoid damaging your credit rating further but you should think long and hard before approaching loan companies. And remember if you have a poor credit rating you may not be able to get such a loan in any case. Get it right and they can be a great solution to your problems. To consolidate debt – you must be focused and disciplined!
TRY TO RESIST THE TEMPTATION OF GETTING A SECURED LOAN ON YOUR PROPERTY – YOU COULD LOSE IT IF YOU DON’T KEEP UP THE PAYMENTS!
A Debt Consolidation Calculator
There are many of these calculators available online and they can help you work out exactly how much money you’d need to borrow if you’re considering taking out a loan. In fact, it’s best to use them as a tool once you sit down and go through your budget, income, and outgoings.
You’ll need to do this to get a complete picture of your overall situation as you must be fully aware of what you need to do long term. Don’t just snatch a figure out of the air; be disciplined in your approach! The calculator will help you list all your creditors and their payment.
Take a look at this: https://www.wellsfargo.com/personal_credit/rate_payments/debt_cons
Credit Card Debt Consolidation
If the only debt you have is on credit cards then there is a way you could make things a little easier for yourself, though this depends on exactly how much money you owe. You could possibly get an interest free card and transfer the balances onto this card.
But of course, only do this if you’re in a position to make the monthly payments as they will almost certainly be much higher. It’s obvious you have to resist the temptation to make further purchases. This is certainly a great way to consolidate credit card debt!
THERE IS AN ALTERNATIVE HOWEVER TO STOP YOU FALLING INTO THE LOAN SPIRAL – IF YOUR CREDITORS ARE BECOMING OVERWHELMING THEN HELP COULD BE AT HAND SO DON’T DESPAIR!
Debt Consolidation Companies!
There are a great many companies throughout the United States – they will negotiate with your creditors and could possibly get them to freeze interest rates and give you much more time to pay back what you owe. You pay them a monthly fee in most cases on top of an agreed amount you’ll pay the creditors. But be aware – some fees can offset the money you think you are paying creditors. Sadly it’s a fact you are actually making good money for them!
Some fees are higher than others and you need to be able to pay back money at a minimum level each month! This will all depend upon income, outgoings and how much cash you may have left each month. Some will enable you to pay a certain amount back and then offer you a debt consolidation loan for the rest at a reasonable amount of interest.
The truth is these companies are making a profit from your situation and if you’re happy with that then many can be of great help to you. But do plenty of research and choose very carefully to find the very best companies. Then check out their websites and feel happy in yourself you’re going to the right people!
Think everything through clearly first. You can, of course, find no-profit companies who can put you on a special program. Some of these organizations really can be a fantastic source of help in very difficult fiscal times.
Payday Loan Debt- It Can Be A Nightmare
If you have taken out multiple payday loans you can easily get in trouble with the large amounts of interest loaded into these loans. If you keep rolling them over you end up in perpetual debt and that is no good. IN this case, you need payday loan debt help to recover your sanity as well as your credit score.
Debt Consolidation Programs
There are organisations who specialise in these types of schemes as finding yourself in debt isn’t rare given the economic climate of the last few years. So many individuals find they are so far in the hole that they are having to make difficult choices between the necessities of living and paying their bills.
Living in fact, from day today! A debt programme can stop the hole getting bigger and help begin to fill it back in albeit very slowly. You can then stop and take stock of everything. They won’t charge a fee and you pay them a certain agreed amount each month – this can even be quite a low figure in some cases. Your case is reviewed now and again and the monthly amount can increase when you start to get back on your feet.
Again carry out plenty of good research and ask the various consumer groups right across America for advice. You’ll stop all the letters, calls and extra stress by letting these people negotiate for you – again they can even arrange for interest to be frozen and will know a lot of the companies involved quite well as they deal with them on a daily basis.
Remember, any form of debt settlement is a negotiated agreement between a debtor and any creditor to whom the debt is owed. It covers all your unsecured debt like credit cards, other loans or forms of credit. All unsecured debt settlements can be handled in one place at the same time. This in turn makes things much easier for everyone involved.
Debt Consolidation Information
There’s a wealth of information to be found on the internet and it never does any harm to talk to consumer advice groups either. Take some valuable time out to do this methodically. They can point you in the right direction and will also have recommended companies and groups you can go to.
The most important thing is to recognize when you’re in trouble and do something about immediately – this can save you so much stress and hassle in the long run. Help is always at hand so never be afraid to ask!