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DEBT CONSOLIDATION & MANAGEMENT : WHAT IS THE BEST WAY TO CONSOLIDATE CREDIT CARD LOANS?

August 4th, 2009 Leave a comment Go to comments
Debt Consolidation & Management : What Is a Best Way to Consolidate Credit Card Loans?

As mostly as we get requests to open brand new credit label accounts, there have been an next to series of debt consolidation companies that demand they have a most appropriate devise for we at a lowest rates with a most appropriate patron service. When we consider of consolidation at such a formidable monetary time, it roughly seems similar to a debt consolidation association can save your life.

Part of a great debt consolidation government devise should embody how to find the right debt consolidation association to assistance we conduct this routine effectively. There have been a couple of things that we can do to have certain we have been with a association that can indeed have your incident better. There have been additionally a accumulation of online as well as imitation resources that can be used but any price to you. With a tiny bit of time as well as education, there have been things we can do on your own that a debt consolidation association could suggest you.

Beware of a Easy To Fix Messages. We have all seen these ads online or in a mail: “We can compromise your debt complaint in usually a single click!” Or might be this one: “We can assistance we cut your remuneration in half.” Whatever a discerning promises offer, they can be a tantalizing selling square offering to people who might additionally be exposed as well as carrying monetary issues with their debt.

The misfortune debt consolidation decisions we can have engage removing yourself in to some-more debt by receiving out nonetheless an additional loan. Hard income loans can be a discouraging preference for people who have been already a outrageous credit risk. This mostly equates to most aloft payments, aloft seductiveness rates as well as over time we will positively finish up profitable most some-more than a strange debt. Also be heedful of any debt consolidation companies that suggest a guarantee to take caring of everything. Nothing is that easy, as well as we essentially compensate them a tiny commission any month that goes to them for their services, as well as not towards your debt.

By flitting on your remuneration to a creditors, a debt consolidation association receives a remission as well as we compensate for this altogether rebate in your debt. It is critical to ask yourself if this isn’t a same thing we could do yourself, have your own negotiations for remuneration options as well as with a tiny research, we can sense that debt to compensate off first. Many debt consolidation companies can additionally have late payments or even skip payments that in spin continues to supplement to a already bad credit score. So, if we do confirm to go with a debt consolidation company, ask about their rates first, as well as see how most they can hit off your debt check right at a start. Also, it doesn’t harm to ask around. Word of mouth is mostly a most appropriate source of information, most improved than an ad in a Yellow Pages. Ask people if they can suggest a great debt consolidation company.

Let’s take a theme of credit cards as a comparison. We all would adore to be means to send a change of a credit label to an additional a single with a reduce seductiveness rate. What a credit label issuers have been not revelation we is that a reduce seductiveness rate usually lasts a couple of months as well as afterwards we compensate a normal seductiveness rate or mostly even aloft once a opening suggest is up. This forces we to switch cards nonetheless again, that is fine as prolonged as we recollect to do it. Otherwise a charges have been piled on again. Eventually, if we have been not careful, we have been trapped in to credit label debt with tall seductiveness payments as well as even some-more debt than we would have incurred by withdrawal it as it was in a initial place.

So it is with debt consolidation companies; they have been not all combined equal. So be clever when we pointer up. Make certain they suggest we preference as well as flexibility, as well as that their staff have been all competent penury practitioners, not usually loan salesmen.


Watch a video associated to most appropriate debt consolidation company

There is no most appropriate approach to connect credit label loans, since this routine accomplishes zero some-more than fixation a red dwindle on a credit score. Discover a most appropriate approach to get out of debt withhelp from a owners of a debt traffic association in this giveaway video on debt as well as income management. Expert: Peter Repak Contact: www.ClearFinancialCompany.com Bio: Peter Repak has been in a debt allotment commercial operation for over half a decade. He as well as his mother founded a Clear Financial Company. Filmmaker …

Help answer a subject about most appropriate debt consolidation company

Will any debt consolidation association embody secured debts similar to cars as well as tutorial loans in to a program?
Will any debt consolidation association embody secured debts similar to cars as well as tutorial loans in to a program?
Is it uncommon, does any a single know of one?

About Author

Gordon Goodfellow runs consumer websites that supplement value. His debt consolidation site offers a far-reaching operation of services as well as options to those with debt. His join forces with site offers debt consolidation association advice in a United States.

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  1. sherina d
    August 4th, 2009 at 01:35 | #1

    If you have 10k in the bank, why not use half of it on your debt. That would make things much more manageable.

    Then get yourself on a written budget and attack the other 7500.

  2. Ruffus
    August 4th, 2009 at 01:47 | #2

    Stay away from any that charge a fee.

    Most if not all of these companies will trash your credit.

    What they do is not pay your creditors for months and then try and settle for less under the threat of bankruptcy. No special skills. They just don't pay.

    Your creditors do not have to deal with these people because it is your debt.
    Also, If they don't pay you creditors. You, and you alone are still responsible for the debt. Your creditors will sue you and not the company you hire.

  3. CaliRedRose
    August 4th, 2009 at 02:11 | #3

    Learned a lot about FDR’s debt reduction program from this video.

  4. August 4th, 2009 at 03:03 | #4

    Debt Consolidation is actually several options, explained here by Freedom Debt Relief… including credit counseling, debt consolidation loans, debt settlement and other options. Good info.

  5. jimmyaven
    August 4th, 2009 at 11:54 | #5

    Hi, Jimmy:

    First, I already answered a related question, so I've copied that answer below after the dashes.

    If your number one objective is to simply improve your credit, you could just wait it out for another 2 years until the debt is 7 years old. You can then ask for it to be removed from your credit report. If this is your objective, then don't pay the debt. Records on your credit report are good from 7 years of last transaction so any payments or charges you make resets that 7-year clock.

    Personally, I've never used a debt consolidation company because I've felt capable of trying the same tactics myself. Granted, these companies are professionals and may get special "deals" and privileges that I wouldn't get, but I've still been pretty pleased with my own results.

    Before using a debt consolidation company, I recommend trying your own hand at it. Contact your creditors. Before you do, determine how much you can afford to pay in a monthly payment. Even better, if you have some money saved up as a lump sum, you can try to pay them off in a couple of chunks. The more money you can give them at once, the better your negotiating power.

    If you're in collections, ask the creditors by how much they'll reduce the total amount owed if you pay now/in 30 days/in 60 days/within a year.

    If you're not in collections yet, ask the creditors how much they'll reduce your total interest. Some companies (e.g. Discover used to do this) will even suspend interest entirely while you're in re-payment. Of course, you can't use the credit card during that time, but you're saving money and salvaging your credit.

    Good luck!
    ———————–
    There are several benefits to credit card consolidation:
    - Convenience (only one or two payments)
    - Easier to manage (less likely to forget a bill!)
    - Possibly a lower combined interest rate

    Generally, when companies help you by consolidating your credit cards, they contact the credit card companies on your behalf and try to negotiate a lower interest rate (you can do this on your own, by the way). Then, the companies can take one of several methods for that single consolidated payment. Options include…
    - Financing your debt themselves and then THEY pay your creditors
    - Helping you find a financier to consolidate your debt
    - Having you roll all of your debt under one of your existing accounts and pay off the others

    As such, credit card consolidation does not affect your credit rating. In fact, the results of consolidation are often positive simply because it's easier to manage and you may pay less interest.

    All this being said, I've never used a consolidation agency because I never wanted to pay the fees. Instead, I contacted my creditors myself and asked for the best possible interest rate they could give me, and asked what kind of arrangements I could make to manage debt. In general, they all worked with me.

    By the way, here's one thing to consider when paying off your debt: Bad credit falls off your credit report 7-10 years after your last transaction. So, if you have a liability that is 6 years and 10 months old, carefully consider whether you pay it off or not. If you touch that account at all, even if it's to pay it off, suddenly that 7-year period is renewed. So, the choice you have to make is: Do you want something that was bad and is now paid on your credit report for another 7 years, or do you just want it gone entirely?

    There are some ethical questions there, too (e.g. if the debt was yours and you were above 18 at the time, you should pay the debt to be ethical). These are questions that only you can answer. But, when working with a consolidation company, make sure they only consolidate the accounts you want them to touch.

    Good luck.

  6. skwan67
    August 5th, 2009 at 18:35 | #6

    Clear explanation of their debt settlement program!

  7. blisacomo
    August 5th, 2009 at 19:19 | #7

    Good to see straight info on a confusing issue like debt consolidation. I liked the graphs.

  8. mbjb06
    August 6th, 2009 at 01:02 | #8

    Credit Counselors charge between $10-$50/month and get your interest rates cut a bit.

    Debt Settlement companies usually charge about 15% of what you owe over the term of your program.

    A mortgage debt consolidation will cost you from 1% to 4% of the amount you refinance.

    What you should really look at is what is the total cost to get debt free, how long the program will take, and how low each can get your monthly payment.

    Try to get a free consultation from someone, this page had a good review of your options and considerations so you choose the right path for your situation:
    http://www.bills.com/blog/consolidate-debts/

  9. mrbearpro
    August 6th, 2009 at 04:21 | #9

    You probably could however the interest rate may be high. I would start with your own bank as they know you the best. I work as a customer service agent with GMAC where I deal with people asking about refinancing all the time and I refer them to their own bank or credit union. They might be able to work out a deal because you have a "professional/personal" relationship with them.

  10. A B
    August 7th, 2009 at 00:29 | #10

    Call the hospital and see if they have any programs that can help. Last month when I ended up in the ER with my gallbladder we got put on a payment plan where we only pay off $28 a month until the bill is gone. The surgeons office also worked out a plan where we actually only have to pay half of what the bill would have been (because my dingbat husband cancled our health insurance back in May *smacks head against wall*).

  11. crazyone
    August 7th, 2009 at 04:16 | #11

    I would suggest not going through a debt consolidation company because there are many bad ones out there. Plus borrowing money to pay off your loans to get one payment is like "Borrowing from Peter to pay Paul" as my grandparents told me once. If you do a search on the internet, many of the loan consolidation companies are listed on Rip Off Reports website.

    Here is some advice to do this on your own. With only $6,000 in debt, you should be able to do this fairly quick. Others are using the same method with over $100,000 in debt. It works.

    First thing of course would be to cut up the credit cards and make a commitment to never charge again. Then follow the following plan.

    Make a list all your debts by amount you owe from smallest to largest. Then begin by paying the "most" amount you can each month to the smallest debt with the idea of paying it off quick. Then, only pay the minimum payment on the larger debts. Continue doing this every month until you have the smallest one paid off. Everytime you pay off a debt, call the company and tell them to close the account … that you paid off the debt and that you do not want to leave the account open. They will try to talk you into leaving the account open. Don't do this as it is too convenient and you will be tempted and will sink into debt again. You then start paying the most you can on the next smallest debt in line and go on from there until you have each paid off. Every time you get any extra money, whether it be $5, $10 or more, apply it against your debt even if you have already sent in a payment. You can send in payments more than once a month. Don't go out to eat. It's "beans and rice, rice and beans" as Dave Ramsey always says which just means (cheap meals that you can fix at home). LOL Also do things to make money like garage sales, sell on eBay, get a second job, anything to help you get money to apply toward that debt. It's not about obtaining the best credit score, it's about eliminating the debt.

    You can get more help on how to accomplish this by reading and listening to Dave Ramsey. He has a talk show which you can hear on line through his archives, or live on line, or by radio by entering your zip code and find out what time of day his show airs. Plus there is a lot of reading material on his site to get you started. In addition, he has forums from his site to get help and advice from other people who are in debt. Dave has been there (with debt) and knows what it is like and is now helping people to get out of it. There are people that have followed this method with over $100,000 in debt and have gotten it paid off without going through bankruptcy and without getting some debt help company to do it for them. Dave's website link is below. I would also consider getting his book if you can. I gave mine away a few days ago to someone else on Yahoo Answers who is trying to do the same thing. It is worth the money and not that much, but you can obtain much information just by reading his site, going into his forums (there is a free trial offer) and listening to him on air.

    I hope this information helps you and you get the relief you need. Best of wishes to you.

    http://www.daveramsey.com

  12. McChesney
    August 7th, 2009 at 07:22 | #12

    There is a lot of confusion as to the difference between "debt consolidation", "debt settlement", and "debt management". It sounds like you are looking for a hybrid of debt management and debt settlement which I don't believe exists. In order to accomplish what you are looking for you may be best off just consulting with a non-profit consumer counselor and then handling your situation on your own. Here are the 3 most typical alternatives for bankruptcy:

    1) Debt Consolidation. This is an option where you take all of your debts and combine them into one loan with a lower interest rate. This option has it's advantages as well as disadvantages. The advantage is that doing this will typically not hurt your credit and if disciplined, allow you to pay off your debt sooner. The disadvantages are that i) many of us are not discipline enough and often just go out and borrow more compounding the problem, and ii) often the consolidation loan is secured against your home. This means that you will most likely convert unsecured debt (ie credit cards, medical bills, etc) that is more easily discharged through bankruptcy or settled through debt settlement into secured debt that puts your personal home at risk if you default.

    2) Debt Management Plan (Credit Counseling). Debt Management typically involves a third-party company (usually non-profit) negotiating a lower interest rate and/or longer payment term on your debt. This helps you to lower your monthly payment. The company is paid by your creditors directly for their services. The advantages to this option is that you are able to pay off your debt without excessive creditor harassment or without the risk of getting sued for non-payment of debt. The disadvantage is that it will typically take longer to pay your debts off, hurt your credit score, if you miss a payment the creditors often have the right to revert back to the old terms of the agreement and the company helping you often is beholden to their boss – your creditors.

    3) Debt Settlement. Debt Settlement involves you (or a third-party company you hire) settling your debt for an amount 40-60% less than what you owe. With Debt Settlement, you stop paying your creditors and begin setting aside funds in a settlement account you own to settle with creditors. As the account grows, creditors will be settled one by one. The advantages to debt settlement are that you typically pay off your debt in a shorter amount of time and pay less than your initial principal. You also maintain control of your settlement since funds are placed into a settlement account owned by you rather than sending them to your creditors. The disadvantages are that it will hurt your credit (since creditors typically will not settle until you are at least 6 months late), that you will have to deal with creditors' collection practices, and, if you hire a company to help you, you will have to pay that company anywhere from 10-20% of your debt amount.

    You would be best off consulting with your attorney as to your situation, exploring your options, and then making a decision based on that.

  13. Russ M
    August 7th, 2009 at 10:27 | #13

    Most of the debt repair/consolation/settlement companies want their fees up front and leave you credit trashed.

    Check nfcc.org for listings legit non-profit credit counseling services. They can help you set up a budget and work out clearing up your debt.

    You can tackle your debt yourself by putting every extra penny on the highest interest rate debt, while making minimum payments on the rest. When the highest is paid, move to the next, till they are all paid off.

    It will take 2 or 3 years but if you work at it, you'll be out of debt with a good payment history.

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