What are your options? Weigh the pros and cons.If you can qualify for a mortgage, borrowing against the equity in your home to consolidate all of your debt does have certain benefits, as well as real pitfalls. On the positive side you can immediately eliminate monthly payments. You can also stop bill collectors from calling or taking
legal action because, after all, you’ve paid your debts in full. Finally, the process may actually help you improve your credit rating. First of all, you have to be able to qualify for a loan or a mortgage. You risk losing your home if you’re not able to maintain the payments set up when you borrow against the equity in your house. The debt you’re paying off is not eliminated, it is simply restructure and you run a risk of overextending yourself again. And something a little less tangible, but still very real, you may get a false sense of security… a feeling that the debt is no longer there when in fact it’s tied up in your home. Would a debt consolidation service or consumer credit counseling program be better?Signing up for a debt consolidation service or consumer credit counseling program will immediately decrease your monthly payments to the debts you still owe. Bill collectors will not be harassing you as much, though there is the possibility that collection action will not go away entirely. The programs do teach better money management skills and are successful in eliminating penalties, interest and additional fees on the debts you already have incurred. However, you will not be able to get new credit cards while in the program and you’ll need to qualify by having a certain level of unsecured debt because these programs only work with unsecured debt. If you’re behind on your mortgage you could still lose your home. And it’s possible that participating in such a program may have a negative impact on your credit rating. A couple of tips before you join.
Top Three Debt Consolidation Services
Debt consolidation is a hot topic among people who are looking to repair their credit history and reduce their monthly bills. Debt consolidation involves combining debts from credit cards, lines of credit and other sources into one large lump sum with a low interest rate.Debt consolidation services are popping up all over the country and many operate solely through the Internet. After some careful research, I’ve come up with the top three debt consolidation services.
Debt Consolidation Service #1: Credit Solutions Credit Solutions has been covered extensively by NBC and MSNBC as an excellent method of debt consolidation. A major reason that this service is so popular lies with the fact that the credit counselors understand how difficult admitting one’s debt can be. They take a tactful and friendly approach to helping their customers resolve debt issues. In 98% of cases, Credit Solutions is able to help their customers consolidate their debt in less than 36 months, which is quite an accomplishment for any one service to provide. They call themselves a “Debt Settlement Program” versus a debt consolidation service because they don’t just resolve your debt into one large sum; they also negotiate with your creditors to avoid having to secure your debt with equity in your home or other property. Credit Solutions can lower your debt by 40% – 60% through their conversations with your creditors, and they don’t perform credit checks or advocate bankruptcy. You can learn more about this debt consolidation service by visiting www.creditsolutions.com or by calling their toll-free number at 800.353.7630. Debt Consolidation Service #2: Money Management InternationalMoney Management International partners with Consumer Credit Counseling Services (CCCS) to offer exceptional credit counseling and 24/7 support. Their experienced counselors can help you develop a debt management plan that will assist you in lowering all of your debt and consolidating it into one convenient monthly payment.