The Pros and Cons of Debt Consolidation – Part 2

Debt 0 13

If you’re trying to find a place that gives you the option to consolidate your debts, be sure you’re able to spend the time needed to do some research. Consult the BBB or your personally preferred consumer watchdog organization to stay away from those you don’t want to trust with your financial future.
 
Choose a debt consolidation company that is accessible by phone and email. You never know when a question will arise and you will need to get in touch with the company you choose. You’ll want to ensure that the company you choose to go with is helpful in answering any questions you have.
 
Speak with the debt consolidation company about their fees. These fees must be explained and in your written contract. Also inquire about the payment structure, and which creditors will get what each month. The company handling your debt consolidation will prepare a payment schedule, and you should get a copy so you can see how much each creditor will be paid monthly.
 
Consolidating debt allows you to have one debt payment instead of many. Typically, you should have a plan where your debts will be eliminated after 5 years. Some individuals chose shorter or longer plans for getting out of debt. That way, you will have a set goal and a workable time frame.
 
You must be patient if you want to be free of debt. Debt is easy to acquire, but not easy to pay off. Sticking to your plan, getting a good loan and continuing to pay down your debts are the best ways to have financial freedom someday.
 
Consider all of your options, not just debt consolidation. Often, you can negotiate better terms than a consolidation company can. Inform your creditors of your situation and that you want to do all you can to resolve your debt. By doing this, they will be more likely to try to assist you in any possible way.
 
Once you have narrowed down your debt consolidation options, look up the company on the BBB website and check for past complaints. You can find companies that have offered good service, and bad.
 
Understand your debt situation. Debts that aren’t going to be covered by any consolidation agreements are then going to have to be paid off separately. This means that the debt consolidation won’t matter much. Scour your bills and your credit report to make sure you have included all your debts.
 
Keep in mind that when you use debt consolidation you are just trading a debt for a different one. It’s impossible to get out of debt by taking on new debt. You may end up paying on consolidation loans longer than you would have been paying on existing debts. Call your creditor with the highest balance and see if you can negotiate lump sum payments that are less than what’s owed. Once that has been paid off, move to the next highest debt. Eventually, all your debt will be repaid, and you won’t have to deal with paying back a debt consolidation company. Understand that this is truly the best option.
 
Now you know whether consolidation is right for you. You know what you need and can use it to manage and eliminate your debt. Don’t let debt overwhelm you any longer. Rather, get the help you need from a qualified debt consolidation firm.

About the author / 

FirstStepFinance

Leave a reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.