Is your debt out of control? Are you late on most of your bills and have credit cards companies started calling you? Ignoring the problem will just make your financial woes worse. What should you do if you don't have the money to pay your credit card bills? There are some options that you should consider to save you the stress of money troubles and to help lessen the impact to your credit rating.
One option is debt consolidation. You've probably seen ads on TV or the internet that tell you that they can help you manage your bills. Many of these are debt consolidation services and while most of them will be able to help you consolidate debt, there are some things you should be aware of.
First off, it's important to understand what debt consolidation is and what it is not. While some services may appear to be miracle workers, there is no way to erase debt without settling your account. Don't trust companies that promise you they can erase debt with no repayment on your part. Debt consolidation is also known as debt negotiation or settlement and it is simply asking creditors for new terms. A debt consolidation service will contact creditors and ask to lower interest rates, lower monthly payments and/or extend the length of your loan. This will result in a lower monthly payment and will relieve you of some of your financial burden.
However, consolidating debt does come at a price; if it didn't then everyone would do it, regardless of their financial situation. The credit card company will usually freeze your account and even creditors that you are not negotiating with will usually do the same. You may be left without credit cards until your debt is repaid and you have a decent credit standing. Your consolidation and negotiation will be reported to the credit bureaus so your credit report will also be tarnished.
To find a debt consolidation service search the phone book or the internet. It's best to find a service in your area so you can talk about your needs face-to-face with an agent. Be wary of companies that won't give you details until you give them money. Most should offer you a free consultation, preferably in person. Ask specifically about what they can do for you and what fees they will charge. Again, if it sounds too good to be true, it probably is.
The best idea may be to seek the assistance of a credit counseling service. They can look at your finances and advise you on the best strategy for your situation. If debt consolidation is the best solution then they can usually provide the service. There is usually a consumer credit counseling service in your area that is non-profit or not-for-profit and funded by the government. They'll offer you free consultation and their services come at a nominal fee. - 23802
One option is debt consolidation. You've probably seen ads on TV or the internet that tell you that they can help you manage your bills. Many of these are debt consolidation services and while most of them will be able to help you consolidate debt, there are some things you should be aware of.
First off, it's important to understand what debt consolidation is and what it is not. While some services may appear to be miracle workers, there is no way to erase debt without settling your account. Don't trust companies that promise you they can erase debt with no repayment on your part. Debt consolidation is also known as debt negotiation or settlement and it is simply asking creditors for new terms. A debt consolidation service will contact creditors and ask to lower interest rates, lower monthly payments and/or extend the length of your loan. This will result in a lower monthly payment and will relieve you of some of your financial burden.
However, consolidating debt does come at a price; if it didn't then everyone would do it, regardless of their financial situation. The credit card company will usually freeze your account and even creditors that you are not negotiating with will usually do the same. You may be left without credit cards until your debt is repaid and you have a decent credit standing. Your consolidation and negotiation will be reported to the credit bureaus so your credit report will also be tarnished.
To find a debt consolidation service search the phone book or the internet. It's best to find a service in your area so you can talk about your needs face-to-face with an agent. Be wary of companies that won't give you details until you give them money. Most should offer you a free consultation, preferably in person. Ask specifically about what they can do for you and what fees they will charge. Again, if it sounds too good to be true, it probably is.
The best idea may be to seek the assistance of a credit counseling service. They can look at your finances and advise you on the best strategy for your situation. If debt consolidation is the best solution then they can usually provide the service. There is usually a consumer credit counseling service in your area that is non-profit or not-for-profit and funded by the government. They'll offer you free consultation and their services come at a nominal fee. - 23802
About the Author:
Dave Almentenk works almost entirely for http://www.debtania.com , an internet site with information about consolidate debt amongst a personal loan and loan to consolidate debt. You might discover his abstracts on personal loans to consolidate debt on his site.
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