Debt consolidation offers you the opportunity to get rid of debt up to six times faster. If you feel as though debts are piling up quicker than you can pay them down, consider consolidation as a way to reduce interest rates, waive fees, lower monthly payments and potentially save thousands of dollars.
How It Works
Consolidation involves signing up for an account with a debt consolidation service, which will then connect that account with all of your outstanding unsecured loans such as student loans, personal loans, credit cards and store lines of credit. You will then pay a monthly fee that is usually less than or equal to the sum total of minimum payments that you would have to pay for all of your credit cards. However, you’ll be able to pay down your cards more quickly because debt consolidation services negotiate with creditors to reduce your interest rates. If you’re interested in debt consolidation, here are three major reasons why it might be the right option for you:
- Lower Interest Rates: This one is huge. It means that you actually end up saving money in the long run, even with the service provided by the debt consolidation provider.
- Better Credit Score: Your credit score is based largely on two things: how reliably you pay your debts and how much debt you have overall. Debt consolidation will help you pay off your debts every month without fail and make your debt level go down more quickly.
- Pay Off All Your Loans At Once: If you have several different types of loans, it can be challenging to remember the login and portal information you need to pay off each loan online. If you pay them by hand, it can be hard to remember to send all the checks each month. Debt consolidation ensures that you never have to forget a payment again.
If all this sounds like it would be helpful for you, consider debt consolidation services as a solution to your credit issues.
Are you spending hundreds of dollars every month just to make the minimum payments on your student loan and credit card debts? Do you worry that you won’t have enough money to make rent or pay for your family’s food because of all your debts? If so, you may need to sign up for credit counseling. While it can be hard to talk about debts, the solution is out there and it’s within your reach. Visit a credit counseling service and you’ll be well on your way to fighting off that debt.
With a credit counseling service, a debt consolidator works and communicates with your creditors to create a debt management plan that will reduce your interest rates, lower your monthly payments and waive any late or penalty fees you might have accrued. The consolidation service then makes these reduced monthly payments on your behalf. In exchange, you just pay a single, affordable monthly payment to the service provider.
Studies have shown that consumers save thousands of dollars in interest fees and pay down all of their consumer debt much more quickly than if they hadn’t consolidated their debts. This could just save your financial life and improve all the other aspects of your life as well, because when you aren’t stressing over your debt, you can put more of your energy into the things you care about.
What is Credit Counseling?
In addition to debt consolidation, a credit counseling service like CreditGuard of America will also provide counseling to help you learn financial management skills. This is given with an eye to the present as well as the future. The goal, once you’ve paid off all of your debts, is to avoid getting into any future debt. You can do this by managing your financial situation more effectively.
You will learn important skills such as money management, credit management, personal budgeting and saving for a rainy day as well as important tips for staying frugal and avoiding debts. This is vital to help you eliminate your debt in the short term and make smart financial decisions in the long term.
How to Get Started
Getting started is simple. All you have to do is sign up for a credit counseling service and meet with a counselor to begin the process.
Debt consolidation offers you a chance to move beyond your financial troubles and find peace, stability and freedom from stress. The process of consolidating debt is simple and does not require complex finagling or potential damage to your credit score. Credit counselors and debt consolidation service providers understand that your finances are very important, and they treat the work they do seriously to help you get out of credit card debt.
What is Debt Consolidation?
Imagine taking all of your debts and credit card statements and laying them out in front of you. Depending on how much credit card debt you have, this could seem overwhelming at first. With debt consolidation, it makes everything much simpler. You can take all of those debts and roll them into one while having just a single payment due every month. This could reduce stress and improve your financial health over time.
When you only have one consolidated account, not only are you more likely to remember to pay it, but you also have more leverage to ask for reduced interest rates and monthly payments that you can afford. Debt consolidation programs can be your advocates and help convince your creditors to offer reduced interest rates.
How Credit Counseling Fits In
Most debt consolidation services like Credit Guard also offer credit counseling. Counseling gives you the chance to change your life going forward. Your counselor will help you set up a monthly budget that you can stick to realistically. If you follow the plan, you will get out of credit card debt. Your credit counselor will also provide tips on how to be more frugal and set up a savings fund as well as provide moral and emotional support through the process.
It should be noted that debt consolidation is not another loan. You give the debt consolidation programs access to your debts, and they will pay them off month by month as long as you pay them a single monthly fee. In addition to raising your credit score over time, this will put an end to pesky collection calls and they will help you get out of credit card debt.