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Debt Consolidation May be able to Work for Your Financial Situation.
Debt Consolidation Information
Last page update: 2011-11-03 – For people seeking help with a debt consolidation for their credit cards and other debts, there are often many available options from which to select. As much as the companies that provide these services vary, so do the needs of each individual requiring assistance with their bills. One individual may have excellent credit and only be interested in a personal loan, whereas another may have bad credit, a large amount of debt and want to know more about the pros and cons of debt management or settlement. Ultimately, determining the best debt solution for your financial situation and the balance of the debts that you owe can be a very difficult task, but the decision rests with you alone. That is, of course, if you qualify for the debt help service, or loan program that you seek. If you take the time to learn and understand how the various methods of consolidating debt can work with your situation, you will be able to make a much better choice. Below, you will find brief descriptions of some of the more common debt consolidation services. Know your options in order to make the best choice for your needs!
Credit counseling agencies provide consolidation programs without a loan. This type of consolidating debts is referred to as a debt management plan (DMP). The consolidation of debt on a DMP can give consumers enough room in their monthly budgets to make progress on paying down their debts. The process involves consolidating multiple unsecured debts into one monthly payment. When consumers work with an accredited agency for credit counseling and debt consolidation, the agency may be able to negotiate better repayment terms based on their relationships with the creditors. The newly monthly payment after consolidation is typically lower than what they were previously paying in total for all of their respective debts. It is important to note that these benefits vary widely from one creditor to another and some creditors do not extend any benefits at all. Learn more by selecting credit counseling under debt relief programs in the menu on the upper right side of this page.
Debt Consolidation Loans
A method of consolidating debts can be available in the form of a loan. The loan is used to pay off multiple debts by securing a lower interest rate or a fixed interest rate with the convenience of a single monthly payment. Debt consolidation loans can be secured against an asset like a house, but unsecured or personal loans are also available from lenders. This solution does have its risks. If the consumer takes out a loan (second mortgage, home equity or mortgage refinance) against their house and are unable to maintain their home loan payments, they risk foreclosure on their property. Learn more by selecting debt consolidation in the menu.
This type of program involves a settlement company negotiating with creditors to lower the outstanding balance of a person's debt. Monthly payments made under a debt settlement program are placed in a settlement fund or an escrow account in anticipation of reaching an agreement with the consumer's creditors. Typically this option of debt relief is not available if the total debt owed is less than $10,000. This option also carries a certain amount of risk as there are some creditors who will not accept the settlement terms and can pursue legal action against the consumer. See more by choosing debt settlement in the menu.
Current Blog Article
Latest Blog Article Posting – Title: "When Debt Consolidation is not the Answer. Know the Statute of Limitations." | Date Published: 2011-09-27 | Subject: Collection of personal consumer debt. | Posting Summary: What happens, and what should you do when you suddenly get a call from a debt collector about a credit card bill or other liability that you thought was written off years earlier? The debt in question may have been changed off, but that does not necessarily eliminate your obligation to the original creditor. Protect yourself by learning about the statute of limitations as it pertains to any old outstanding debts and how the passage of time may protect you from future legal actions brought by lenders / creditors.
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