Is getting out of debt and having control of your finances something you are looking to do? Are you having trouble paying the bills every month? If so, consider debt consolidation. The following advice will help you determine if debt consolidation is right for you and how to proceed.
Talking to your creditors can help you reduce your monthly payments. Most creditors will work with debtors to help them get out of debt. If you find that you’re struggling with your monthly credit card payments, call the company that issued you the card. Tell them you need help, and you might just find that they’re willing to lower the amount the minimum amount of money you need to pay each month.
Bankruptcy is something you should seriously consider. Any bankruptcy, whether Chapter 13 or 7, will leave a lasting ding on your credit reports. However, if you’re already not able to make payments or get any debt paid of, you may already be dealing with bad credit. A bankruptcy filing can eliminate some of your debt and help you work your way towards financial freedom.
One option to consider in debt consolidation is that of using an introductory low-rate credit card to pay off your debts. You can save a great deal on the interest, while also combining all your bills into one easy payment. Once all of your debts have been consolidated onto a single card, get to work on paying it prior to when the introductory rate goes away.
Once you’ve gotten a loan for outstanding debts, speak will creditors to see if you can work together on a settlement. Many will accept as much as 70% of that balance in one lump sum. This will not affect your FICA score; it may even help it.
Find out if the debt consolidators you’re using are certified counselors. You can use the NFCC to find reliable companies and counselors. This way you can be sure you are working with a legitimate company.
Don’t look at debt consolidation as a cure for all your financial problems. Debt will always be a problem if you are not willing to change how you budget and spend your money. Once you have found the right loan, take a hard look at your spending habits and make the necessary changes for a healthy financial future.
If you really need to escape debt, think about taking money out of your 401K. Borrowing from a bank or from another financial institution will probably cost you more than borrowing against your own 401k plan. Keep in mind that you can lose your retirement funds if you are not able to pay back the money you borrowed against your 401k plan.
How did you end up so deep in debt? Find out what you are doing wrong with your finances before implementing debt consolidation strategies. After all, if you are not aware of why you have gotten in this much debt, you will just fall right back into this hole in the future. Determine what the problem was, fix it, and move forward with paying your debts.
Debt management may be a good solution to your financial woes. Paying your debts off in full will be better for your credit score. You just need to find a company who will work with you to negotiate a lower interest rate, allowing you to pay off your debts faster.
A debt consolidation program can help you hold on to some of your assets in some cases of Chapter 13 bankruptcy. You can keep much of your personal or real property if you are able to uphold your obligations and pay off the debt within a 3-5 year time frame. You could qualify for having all interest waived from the debt during this.
There is lots of information available about debt consolidation. It can be overwhelming to learn all you need to know, but making the right debt consolidation choice can help reduce your financial stress. Debt consolidation can keep you from feeling overwhelmed and lower the total amount of money you have to pay back.