Search
Recommended Products
Related Links


 

 

Informative Articles

5 tips about Debt consolidation
Debt consolidation is a way to financial freedom, having a positive impact on the credit rating. Credit rating, quality of living, and the impact on the family, are affected when creditors harass for payment and the payment made causes...

All about Debt Consolidation loans
Debt consolidation loans can be the answer to a number of financial problems, but before you take the plunge, make sure you're well informed. What is a debt consolidation loan? Debt consolidation is when you arrange a single loan to cover a...

Debt Consolidation - Is Your Future Bright?
Most people have taken out plenty of loans and other forms of credit, from various sources over the years. These could include student loans, credit cards, store cards, a bank overdraft, car loan, goods bought on a buy now pay later basis. All of...

Debt Consolidation Loan
Debt Consolidation Loan Debt consolidation loans can give you a fresh start, allowing you to consolidate all of your loans into one - giving you one easy to manage payment, and in most cases, at a lower rate of interest. Secured on...

Securing a Debt Consolidation Loan
It's the day you've been waiting for the last two weeks... payday and the only time when your face lights up and you actually go to the office with a lot of wonderful, dreamy thoughts in your head - such as how fast you'll be able to bolt out of...

 
Google
What is Debt Consolidation?

Debt consolidation may be the answer for anyone drowning in a sea of unpaid bills. Debt consolidation lumps all of your unsecured debts including credit card bills, doctor, dentist, veterinary, and other service provider bills any bills that are not secured by collateral or property such as an automobile or a house into one monthly payment.

Types of Debt Consolidation

There are several ways to achieve debt consolidation, including one that does not require borrowing more money. Debt consolidation options include:

1. Home Equity Loans A popular method of debt consolidation, the home equity loan is a mortgage based on the amount of equity you have invested in your home. It should be noted that home equity loans are secured by your house, which means if you fail to make payments on schedule, and according to the terms of the loan, you risk losing your house.

2. Personal Loans Many banks and other lenders offer unsecured personal loans based on your annual income. The amount that can be borrowed will vary from person to person, and not everyone will qualify for this type of loan. To use personal loan proceeds for debt consolidation simply deposit the loan money into your bank account and write checks to your creditors, or ask the lender to disburse the money to your creditors for you.

3. Private Loans Some people may be able to borrow from family or friends and arrange very individual terms. Borrowing from others in your personal life can be tricky business and


it is advisable to make sure any arrangements are made in writing.

4. Debt Management Plans Not everyone will qualify for a personal loan, and not everyone owns a house, or has someone in their personal life from whom they can borrow money for debt consolidation. For people in this situation there is another option available - a debt management plan through a credit counseling agency. Even if you have all of the previously mentioned options available to you it may be more advisable to seek out a debt management plan. Debt consolidation through a debt management plan involves having a credit counselor negotiate with your creditors for payments you can afford. You end up making one monthly payment to the credit counseling agency which then sends money to your various creditors.

Regardless of which type of debt consolidation plan you choose, be sure to check out potential lenders or your credit counseling agencies thoroughly. It is also strongly advised that you destroy paid off credit cards and formally close those accounts to avoid the temptation to charge them up again. When done carefully and with consideration, debt consolidation will ease your financial worries.

About the Author

Timothy Gorman is a successful webmaster and publisher of Debt-Relief-Solutions.com. He provides more debt relief, consolidation and free debt consolidation information that you can research in your pajamas on his website.