Digging yourself into a deep hole financially with credit card debt is devastating. It feels as though you are facing an impossible mountain to climb. Often times, you probably feeling like throwing in the towel and just giving up. However, the persistent calls from debt collectors and watching your credit score gradually decline gives you the motivation to find help. You finally decide to dig yourself out of this hole and rebuild your financial strength. It is a great decision, and many resources are available to begin filling the hole.
Debt Consolidation and Filling your Financial Hole
One of the best ways to take action immediately is working with a debt consolidator. The company negotiates with credit card companies where the goal is obtaining a far lower rate and payment. Once the terms of the negotiation are approved, all of your debt is consolidated into one easy monthly payment. Not a loan, but all your debt merged into one payment. Your payments are lower, your credit score improves, and bill collectors stop calling. This is the first step in filling the hole.
Keeping Credit Card Debt under Control
Consolidation of all your credit card debt is not the only step. Once the terms of the consolidation are agreed upon, and you start making your monthly payment, the process does not end there. You must seek out financial counseling to continue filling that deep hole. Once you find stability in your financial situation, you start thinking about a new credit card and how one card will not hurt. Stop there immediately, think about what you are doing and how that decision nearly ruined you the first time. Use the financial counseling resource from the consolidators who fixed the first part of your financial situation. Otherwise, you may find yourself right back at square one.
Debt Free for Life
Unfortunately, throughout the course of your life, certain debts remain. It is certainly not the kind of debt that dug that financial hole. Taxes, insurance, food, shelter are the kind of debt you will always face. To keep yourself in a positive frame of mind, think of this type of debt as manageable debt.
Although the economy has improved over the past year or so, many people are still dealing with the effects of long-term unemployment and reductions in pay, namely credit card debt and other bills that are difficult to manage. It might be tempting to consider taking out a debt consolidation loan in order to pay off the outstanding bills and make only one payment per month. However, that is just trading one set of debts for another and not doing anything to help you reduce your debt balance. A better option to consider is consumer credit counseling.
Working with your creditors, a credit counselor will reduce both interest rates and monthly payments, as well as get certain late fees and other charges waived. They then set up a monthly payment schedule with your creditors. You make one payment each month to the credit counselor, who disburses that money to your creditors according to the approved schedule. With this plan, you can have your debt paid off much sooner, saving you thousands of dollars in interest charges.
Consumer credit counseling offers a number of benefits that debt consolidation loans or debt settlement plans do not. These include:
- Working with your creditors to create an affordable payment plan
- Eliminating collection calls that often come at inconvenient times
- Working with a trustworthy counselor who will handle your payment plan as arranged
- Money management counseling in order to avoid future problems
Credit counselors typically work only with unsecured debt, such as credit cards. They can also help you with settling outstanding medical bills, student loans and other bills turned over for collection. Most counselors offer a free no-obligation consultation where they will review your situation with you and let you know what they can do to help. While they do not themselves make loans or offer legal advice, they may be able to refer you to someone who specializes in those fields if it is appropriate.
Consumer credit counseling can be an effective way to bring your unsecured debt payments under control. It is also a great way to learn how to manage your finances in order to avoid debt problems in the future. While it may seem impossible today, a credit counselor can help you create a path toward being debt free in just a few years and back on the road to a solid financial future.
Consumers searching for solutions to their debt problems often discover credit counseling and consolidation services. This is a great choice to help you get your debt under control and reduce the amount of minimum monthly payments you are making. As you perform your research, you may discover that there are non profit credit counseling services out there. What are these and are they a good option for you?
Does a Non Profit Credit Counseling Service Charge a Fee?
One of the biggest misconceptions about a nonprofit credit counseling service is that they don’t charge their clients a fee. You need to remember what nonprofit actually means. Any company or organization that calls itself nonprofit simply puts all earned income back into the business. This can be in the form of employees’ wages or improvements to the business. However, they do sometimes charge a fee for their services. Some companies may request a ‘donation’ instead of charging a fee.
How Does a Non Profit Differ From a Regular Consolidation Service?
The only real difference is where they put their fees. A for profit service may have shareholders or another way that they share the dividends with employees. A non profit credit counseling agency puts all money back into the business.
Which Choice is Better for Me?
It really depends on what your goals are. You need to do your research and narrow your choices down before deciding who you want work with to get out of debt. Non profit versus for profit may mean nothing to you. One is not necessarily better than the other. As with anything, do your research before jumping into any debt consolidation services.
Non profit credit counseling can be a good deal for the consumer if they charge lower fees than a for profit service. However, don’t let the term nonprofit lead you to believe that they are necessarily cheaper or better than another service. You still need to research any company that claims to be a nonprofit to make sure they are legitimate.
Debt can be one of the most stressful and difficult to manage elements of daily life. When a person is in debt, the debt is always in the back of their mind. A person who is in too much debt hesitates before answering the phone, avoids checking the mail, and constantly feels as though they’re in over their head. But what these people need to know is that there are tools out there right now that can help them out of debt, and help them build a better financial platform for themselves and their family.
Consolidating credit card debt is one of the fastest and easiest ways for an individual to begin taking control over their situation. There are two types of debt from a credit score perspective: good debt and bad debt. Good debt consists of items such as mortgages, car loans, and student loans. These items of debt do need to be paid down, but not as quickly as bad debt. Having some good debt on good terms actually helps your credit score rather than hurts it. Bad debt consists of unsecured debt, such as unsecured loans and credit cards. The majority of debt problems today come from credit card debt, which makes consolidating credit card debt so important.
In order to consolidate credit card debt a borrower must enter into an agreement with their individual creditors by using a loan consolidation service. These creditors are made aware by the service that the borrower is currently trying to take real action to remove their debt. The majority of creditors will then agree to lower their percentage rates as long as the borrower is signing up for this program. The lowering of interest rates will dramatically reduce the borrower’s monthly payments, which makes it easier for them to pay off the balances in a reasonable amount of time.
While the ability to consolidate credit card debt does make managing debt easier, it’s not the only step that someone in debt needs to make. A person in debt also has to look at their monthly spending and identify ways that they can cut down on their expenses and increase the amount of money they put towards either their debt or their savings.
Millions of people are finding themselves in a significant amount of debt. You keep charging purchases on your credit card and before you know it, you are facing an uncontrollable amount of debt. Therefore, it is important to find a solution to your financial problems. If you have a huge amount of unsecured debt, credit card consolidation might be the answer.
What is Credit Card Consolidation?
Consolidating credit card debt involves putting all of your credit card payments into one affordable monthly payment. You will have one payment, so your debt is easier to manage. By consolidating, you will be able to obtain lower interest rates, so you can pay down your debt quicker. Your monthly payments will be lower, so you can make your payments on time. You can save thousands of dollars in interest, and you can pay down your debt in less than five years.
An experienced credit counselor can help you with debt consolidation. The counselor will be reliable and dependable, and they will help you eliminate your debt fast. A credit counselor will help you learn how to manage your money, and they will negotiate with your creditors to come up with an amount you can afford. They will help put a halt to harassing calls from your creditors, and they will provide you with emotional support. A credit counselor will offer you a free no obligation consultation. You will learn how to budget your money, so you will know how to stay out of debt. Working with a credit counselor is better than a debt consolidation loan, as a loan can lead to more debt.
Benefits of Consolidating your Credit Cards
Debt consolidation can help reduce your interest rate, so you will be paying less money each month. Because you will be making payments on time, consolidation will keep your credit score from declining drastically. In addition, you can get out of debt much faster by consolidating.
Credit card consolidation can provide you with a solution to your debt problems. You can eliminate your debt and you will enjoy a bright financial future.
Many people who are in debt might have reservations about seeking out help. Our mindset is often that we need to do everything on our own, but that is fallacious thinking that leads to more trouble. Yes, you are responsible for the debts that you incur. However, not seeking out a more payable payment plan would also be less than optimal. If you have multiple lines of credit or unsecured loans, you need a special type of help. The type of help that covers multiple areas of problems for people who are indebted, this help comes from debt consolidation.
Debt consolidation is a program that brings all of your non-secured debts under a single commitment. This consolidation debt payment is proven to be easier to track and manage into your expenses. Instead of several monthly bills to be responsible for remembering, there is only one that you need to worry about.
One large payment is easier to work into when creating a budget for your household, and if you’re having difficulty doing that consolidation services provide financial counselors that are knowledgeable in structuring your finances. They will teach you the skills that are necessary to get your budget in order and quickly learn how to pay off debt. With a proper budget you would be surprised at how much you actually have.
Once you can establish what you need to pay, and the way to pay for it, the next task is simple: persevere. Many people through a debt consolidation program can sheer off months or even years from their original payment. All they did was stick with the plan that they were advised on, and with a bit of a “can do” attitude they finally beat the system that has been sending them into dire financial straits. If you save time, then you also save money. By paying off your debts early, you then save money that you don’t have to pay on interest!
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Online debt consolidation is available to anyone who has multiple unsecured loans and is looking to bring them under a single monthly payment. These services bring any credit card charges or any loan without secured collateral into a single payment bundle. A consolidator will talk to you and your creditors, and bring all your balances under the same monthly payment. Consolidators talk to your creditor to reduce your interest, or even reduce late payment penalties.
The primary goal of a consolidator is to find a balance of what pays off your balances quickest and what is best for a client’s short term budget too. The secondary goal of a consolidator is to help prevent future debts from accumulating again. Consolidators have trained professional advisers that teach a wide array of budgeting skills that can help bring your bottom line from red to black. Consolidators often provide a worry free no-obligation credit consultation that will assess your current credit situation and what exactly needs to be done to get you out of debt. The peace of mind that comes when someone is actively helping you with your debt problems is a huge relief for all. Some consolidation services will also provide emotional counseling if the payments are draining that also.
Debt can happen to anyone. Automotive, family and medical emergencies bills accumulate or pop up; student loans and credit cards have their balances too. These debts are not as hard to pay off as you might think, and you may be able to pay off all your debts years before their original completion if they had continued on at the minimum monthly payment.
What needs to be done will vary from person to person, but the basics for consolidation are the same. Online debt consolidation is the easiest, fastest, and the safest way to finish up burdensome balances painlessly. Let a consolidator advise and advocate for you to your creditors for the quickest way to whittle down your unpaid balances.
In a down economy, it is not unusual for people to experience some difficulty with overspending. Spending more than one takes in almost always leads to more debt than a family or individual can handle. It leads to a vicious cycle of living from paycheck to paycheck and if one major financial emergency comes along, it throws the whole budget into a tailspin. For those who carry a lot of credit card debt, the experience can be daunting. When there is not enough money to go around, there will be calls from collectors because some bills do not get paid on time while others may not get paid at all. How can people get off the merry-go-round of debt and avoid drastic measures like bankruptcy? One option to consider is credit card consolidation.
Credit card consolidation is a way for those who are heavily in debt to get a fresh start. For example, if an individual has three or four credit cards with balances of $1000 or more with interest rates of 21 percent, it will take many years to pay the cards off when only the minimum payment is made every month. Additionally, the monthly interest that piles up means those minimum payments will usually go toward interest rather than paying down the balance. The interest accrued each month is equivalent to continuing to use the cards and paying on it the bills, but never really making a dent in the amount owed. Consolidation offers a way to drastically shorten this repayment time.
Consolidating debt gives control over one’s finances because there will be only one bill to pay. When the interest rate is lower, the entire debt can be paid off many years earlier than it might by making payments to multiple creditors.
Persons who are considering consolidating credit card debt should keep the following in mind:
- Shop around for the best plan for you. Find one you know you can manage and will provide you with the educational tools you need to execute it.
- Avoid using credit cards that caused the problem. As they climb out of debt, some people are tempted to take out new loans or lines of credit. This will only send them back into the vicious circle of debt. Stay vigilant and avoid more debts.
- Pay the consolidation payment on time and rebuild credit history. Paying the renegotiated debt back on time in accordance with the agreement means it will be paid off faster and that will help raise the credit score.