Debt Consolidation - Things You Need To Know About Debt Consolidation

What is debt consolidation? Debt Consolidation is a way of paying off your debts without declaring bankruptcy, instead of managing a few high-interest rate loans like credit cards people can consolidate their debts using a single personal loan with a lower interest rate to pay off that debt

Benefits of debt consolidation, the main benefit is paying less every month by using a personal loan to pay off other high-interest rate loans, you spend less on interest payment every month and you reduce how much you spend over the lifetime of a loan

Debt Consolidation

It makes things much easier to manage, instead of writing different checks to different financial institutions you just write one

Debt consolidation options, What are the first steps?

Shop around for the best loan once you are approved and get the money for your debt consolidation, pay off your existing loans. 

Here's how to quickly determine if debt consolidation loans are for you

List all your debts on paper including mortgages, car loans, credit card, home improvement, medical bill, etc

Next to these debts write down the interest rates and how much you still own, determine how much you're paying each month, whether you're paying down the principal

Figure out the total amount needed to pay off your loans, use a debt calculator to help you, if you find a comparable loan with a smaller interest rate debt consolidation loan might be for you if you can't don't worry

Other options are available these include
  • Debt Settlement
  • Credit Counseling
Let talk about Debt Settlement
Debt settlement is the legal way to pay less than you actually owe. An agreement with your creditors that's a more reachable target payment that will satisfy your debt. Creditors agree to a settlement because some money from you is better than nothing

How Debt Settlement Work
First, you select a debt settlement company, this company negotiates with your creditors to reduce your total amount of debt, once in the program, you pay a specific amount per month to the settlement company, they hold your money until there's enough to satisfy your debts and pay the fees

How long does this go on generally speaking it takes two to four years to finish and be debt free? 

What To Look Out For
  • Be sure the company you choose to work with doesn't bill for fees before a debt is settled. 
  • Claim they have access to a new government program that helps consumers out of jams
  • Make guaranteed that your debt will be eliminated
  • Tell you not to ever communicate with the creditor
  • Promise they can halt all calls from a debt collector and end any lawsuit
Settlement companies don't make promises they can't keep, they work to help their customers get out by helping you pay less

Credit Counseling
Credit counseling is also another good option, credit counseling involves working with a credit counselor to reduce your debt and develop good spending habits, these counselors are trained in
  • Budgeting
  • Debt Managing
  • Spending Habits
  • Financial Education
They'll help you find the best way to handle your debt. Meeting between a credit counselor and a client are considered confidential when you meet be prepared to tell everything, your income, household expenses, existing debt and spending habits

Don't worry they are generally very understanding and they wouldn't judge. 

Author:

Hi, i am Micheal, the guy behind Roadtosuccesse. I share tips and tricks to help take a business to the next level, show which systems I personally endorse and use, share what I learn as a student of the game, and help people with personal development so that they can reach their full potential.

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