Debt Consolidation Loan – How Not To Get Stung
It is not unusual these days for many consumers to be having a tough time repaying loan obligations and credit card bills. The economic changes that our world has faced is being felt by many and the previous fortunate consumers that had great credit standing have now suffered the challenge of meeting their financial obligations and watched as their credit ratings took a nosedive. It is at this point that a consumer looks for a solution to save themselves from financial disaster and because their credit rating has suffered as a result of their debt, they will often feel that there is no debt consolidation loan available to them.
Debt consolidation loans are available for those with bad credit if you are a smart consumer and locate the right lender for you. When searching for a debt consolidation loan for a bad credit situation, you will be faced with myriad amounts of potential lenders that claim they can get your financial life back in order. Legitimate lenders are available and they are willing to work with someone who has fallen on bad times financially.However, there are also the unscrupulous lenders who wait and prey on a victim who is in a desperate situation. Do not allow yourself to be taken advantage of while shopping for a debt consolidation loan. The following two tips will help to protect you from becoming a victim: Have confidence.You are not alone, with the tough economic times other consumers have low credit scores too. Do not let any potential lender frighten you into accepting a bad loan; you have other alternatives. There are many lenders that are willing to work with people who have a low credit score.
Patience will pay off and you will see there are many options available to you. Look At Those Terms Before you sign any paperwork, a lender will discuss only payment amount and not the actual terms of the loan. Some lenders that say they specialize in debt consolidation loans for bad credit will actually place a consumer in a loan that may leave them in a worse situation than when they started. The lousy loan will amount to a sky high interest rate, stretched payments over a lengthier term and then convincing you that the payment is lower.
On the surface the terms may sound good, however calculate for yourself to see how much the privilege of a lower monthly payment is going to cost you.
There are still good lenders available that will offer debt consolidation loans for bad credit,look around and find a lender that has your best interests and financial well being in mind.
Unsecured Debt Consolidation – Dont Be Afraid
Financial problems can sneak up on the best of us. It does not matter how well we plan, at some point we may face the situation of failing to meet our monthly financial obligations due to circumstances beyond our control. A debt consolidation loan can be a real life saver in this situation. This type of loan can help you to pay your monthly bills and keep a good credit rating. A consolidation loan will be easy to obtain for some consumers especially if they have equity in their home or a vehicle that is paid off.
Those without equity will have to find an unsecured debt consolidation loan. An unsecured debt consolidation loan has a certain advantage over a secured loan. With an unsecured debt consolidation loan none of your high value assets are used to secure the loan. An unsecured loan is a type of loan that is granted on the merits of a persons good credit and past payment history.All that is needed for this loan is a signature and to agree to the payment terms. Even though an unsecured debt consolidation loan does not put your assets at risk, the loan can carry a higher interest rate because the lender has agreed to provide funds to you without assets to protect the loan.
Essentially the lender is taking a risk with you and your past good credit history,as a result you may find that you have to pay a higher rate for this privilege. Careful planning is essential to a successful debt consolidation loan.You need to figure out which debt that you anticipate paying off whether obtaining a secured or unsecured debt consolidation loan. One way to meet your goal of debt payoff is to create a list of all of your creditors, as well as total amount of debt, the monthly payment that is due and the annual percentage rate of the balance that you owe. Next you should organize the loans according to annual percentage rate.
Use the list that you created when shopping around for your loan and seek a consolidation agreement that allows you to pay off your higher rate of debt with your new lower rate funds. One final bit of important advice: Once your debts are paid either with a secured or unsecured debt consolidation loan, you should consider closing any open lines of credit and cutting up those high rate credit cards that are no longer necessary or at least making them inaccessible to yourself. Now that you have been able to consolidate your more costly loans into a more manageable chunk use discipline to keep yourself in good standing so that you do not find yourself back where you started.
Do not fool yourself or tempt yourself with those new low balance lines of credit.
Bad Credit Debt Consolidation Insider Secrets
Do you know what shape your credit is in? Do you find it difficult to keep up with your bare minimum monthly payment obligations? If you have found your credit score dropping lately because you have fallen behind on your monthly payments to creditors, a bad credit debt consolidation plan may be what you need.
You may be able to alleviate some your monstrous monthly debt by consolidating several of your high interest rate loans or credit card debt into a single manageable chunk of debt. How does that work? You may be able to merge loans or credit cards with a high interest rate into a manageable loan that will be available at a lower annual percentage rate. Usually this type of debt consolidation can be had when you receive a credit card offer in the mail with a lower rate than existing cards,if you transfer your balances from the other cards to the new card. It can be a fairly fast and straight forward way to lower the annual percentage rate on your outstanding balances and lessen the minimum monthly payment.
Before you consider the option of transferring your credit card balances to the new lower annual percentage rate, read all the details and understand what will be expected with your new contract. You may find it difficult to find a lower interest rate on a credit card if your credit score is really low. Bad credit debt consolidation is a solution to financial burden for some,however they will find it difficult to find a credit card issuer or a lender to help lower their interest rates. Spotless credit would allow a consumer to receive the best rates in the past, however in today’s marketplace there is a lender available for just about every type of credit rating and those with not so spotless credit will be able to find a bad credit debt consolidation loan as well.
In today’s turbulent economy many people have not so perfect credit and many lenders understand that and are willing to give these consumers a loan. Finally one little secret to a bad debt consolidation loan that many consumers forget, use the equity in your vehicle. To most people the equity in a home is immediately recognized, however if you own a vehicle that has low mileage and a small payoff amount,you may be able to obtain a used car loan at a lower rate than you will have to pay on your credit cards. In certain situations, the auto loan rates may be half the interest rate of your highest rate credit card.
If you are looking for a way to drive down your debt, a bad credit debt consolidation loan may be your vehicle of choice!
Debt Relief Consolidation – Secrets You Should Know
In difficult economic times, debt can be overwhelming. Studies show that financial hard times and the resultant stress can have a negative impact on a person in a physically and emotionally way. If you are sinking into debt,you may be really concerned that you will not find relief from your debt. Although we are facing financially tough times, there are lenders and agencies willing to help with your debt relief consolidation needs.
While looking for help with your debt burdens you will soon discover that there are three main types of debt relief consolidation: credit card balance transfers,credit management or counseling agencies and debt consolidation loans. With a debt consolidation loan, the lender pays off several of your consumer debts and creates a brand new loan for you that will allow for smaller monthly payments than the original monthly payments. Use caution when using a loan as debt relief consolidation, be knowledgeable about the terms of the loan otherwise you may not be getting the type of help that you seek. Many lenders will mainly focus on the monthly payment amount and not the total picture of the payback balance. They could be offering a lower payment, although the interest rate will be a much higher amount. This lower payment is achieved by drawing out the length of pay back and it is usually a longer time period.
In this case your original loan amount would be much more favorable than paying the higher interest rate loan. Debt relief consolidation may be offered by credit card companies via a balance transfer agreement. They will offer a lower rate than you have on any other credit cards if you transfer the balances of the high rate cards to the new credit card account. This may look appealing at first because it looks like you will save some money, however those low rates that they dangle in front of you, may only be for a temporary amount of time.
Often called a “teaser rate” or a “promotional rate”, those terms won’t look so good if you are surprised by the higher rates later down the road after the promo ends. Another option is the credit counseling agency. They can offer you debt relief consolidation by making alternative arrangements with your creditors to pay off your existing debt. The credit counseling agent will cut a deal with lenders to minimize your monthly payments,minimize your interest rate and often the total amount owed. In this situation you will make one monthly payment to the credit counseling agent who then will pay out the individual payments to each creditor. If you decide that a credit counseling agent is the correct route for you, be aware that most agencies have a fee for their service.
Depending on the agency, the consumer may pay the fee or the lender will pay the fee. Do not let your debt concerns interfere with your emotional or physical health. Save yourself weeks of stress.Search for the right debt relief consolidation for your situation by using one of the three common methods and find the relief from debt that you deserve.
Consolidate Credit Card Debt – Be Aware Of Hidden Fees When You
High interest rates can drain your finances quite easily. If you have found yourself bogged down with high credit card rates or loans, it may feel as if every penny is paying down only the interest and not even touching the principal balance. Perhaps you have considered consolidating your credit card debt to reduce your annual interest rate and giving yourself a more manageable debt amount. At first blush, it may seem feasible to transfer your high rate balance to a different card that has a much lower rate.
However before you take this step, be sure to read the contract that comes with the new lower rate card because you may find a few unseen fees that could come back to haunt you later when you do consolidate your credit card debt.
So what should you be aware of? Look for “balance transfer fees.” Some credit card companies will charge you a fee to move your balance from a high rate card to a new lower rate card. Many times the balance transfer fee is a flat rate fee, usually a one time charge of $35 to $45 dollars. Some consumers have been unpleasantly shocked to find that the balance transfer fee was actually a certain percent of the amount that was transferred to the new card. The amount was as high as four or five percent. A nominal $2,000 transfer of your balance could have you seeing a five percent transfer fee that will set you back $100. Make sure you are aware that when you consolidate credit card debt and transfer the balance to a new card;the balance transfer fees are then added to your outstanding balance on your new lower rate card.
If you elect to not pay the the transfer fee immediately, the credit card company will attach the interest to the balance transfer fee. When you consolidate credit card debt onto a new lower rate card, check for any other hidden fees in addition to the transfer fee. Some credit card companies allow you to make payments via telephone, however there will be a fee for payment on the phone.
If you are not aware of the fee, you may be quite shocked to see the phone payment fee and sometimes that fee can be as high as $10.00 for a transaction. You may have to adapt your payment method to avoid getting bit by such a high fee. Before you complete any payment your credit card company should inform you of any type of a payment or convenience fee.
If the credit card company does not, take it upon yourself to ask. Though we as consumers may consider these fees to be hidden, it is only because these fees may have not been forefront in our minds while making the decision to consolidate our credit card debt.
You should be aware that a credit card company is required to disclose any fees to the consumer before the credit card offer is taken.Before you accept the credit card offer, be an informed consumer and read the fine print of the contract.
Debt Consolidation – Your Poor Credit Can Be Overcome
If you have poor credit and are looking for ways to consolidate your debt you may be in for a small challenge before you can get a handle on your financial situation. There is a chance that you are already facing the reality of poor credit if your loan payments are delinquent or you are besieged with debt. Though your credit rating may have been quite good at one point,a difference in your circumstances may have affected your financial situation and allowed you to fall behind. As a result you may have found yourself labeled as a poor credit rating.
Finding a loan with a reasonable rate may be difficult to find. If your one of the many that is drowning in your debt,finding that life saver called debt consolidation may elude you because of your poor credit rating. If even making your minimum monthly payments has you struggling then debt consolidation may be one way to handle your payment problems. Credit card consolidation is one solution to getting a grip on your financial hardship.Combining several high rate cards into one low rate card is one way to consolidate credit card debt, though it will be difficult finding a lower rate card if you have a poor credit score.
A manageable consolidation loan may be another option, however be aware of over extending yourself just to overcome a short-term financial hardship. Due diligence is essential when it comes to debt consolidation because your poor credit could make the situation worse. Many options are available to consolidate debt even if your credit rating is less than optimal. Legitimate ways include using home equity or your vehicle as collateral if needed. Watch for the sneaky types who derive great satisfaction in preying on consumers with credit problems. These unscrupulous dealers are opportunity seekers and see bad credit as good fortune for themselves.These scavengers look for people that are dealing with poor credit because they realize that big lenders will turn away people with bad credit.
A person with a poor credit rating is often desperate and these dishonorable financial scavengers can lead their victim to a financial hazard. There is a possibility that you will be able to find a favorable unsecured loan allowing you to consolidate several debts into one payment plan. Take it upon yourself to read the fine print of the loan agreement and understand completely what is in the contract that you are signing.
An advantage of an unsecured loan in your debt consolidation plan is that your valuable property will not be impacted by your loan. When difficult times have hit you, a debt consolidation loan can help to improve your financial situation. Understand that debt consolidation may be difficult for those with poor credit. Therefore it is especially important to choose a consolidation loan or program very carefully and be sure you know what you are signing before you sign the contract.
A Simple Method Of Consolidating Credit Card Debt
Debt can easily get out of control if a person is not diligent. The good news is that debt can be managed. The most troublesome type of debt for consumers today is credit card debt.Millions of credit card customers are searching for a means to manage their financial responsibilities. Often debt management is found through credit card consolidation.
Credit card debt consolidation can often create more of a financial burden if you do not use a careful approach.It is very important that you have your credit card accounts under control and are not over extended credit wise. One common solution to consolidate credit card debt is by transferring a high interest rate card balance to a credit card that has a lower interest rate. As an example, maybe you have several credit cards that have a balance of a few hundred to a few thousand dollars and a high rate of anywhere from 17 to 20 percent or more. A huge amount of money could be saved yearly by simply moving those higher balances to the card that has a lower interest rate.
Perhaps you have a card that has an interest rate of 13.5 percent or lower.It may be possible to transfer the higher interest card balance to the lower interest rate card.
With a balance that is currently charged several points higher you would see a significant savings by transferring your higher balance to a newer lower interest rate card.This would be a positive method to consolidate credit card debt. But wait just a minute. There are a number of downfalls that need to be addressed before considering this sort of credit card debt consolidation. Before you transfer any balances please consider the following pitfalls: The new card that you are considering may be offering a teaser rate and at some point in the future that teaser rate will expire and become a higher interest rate.
Read the fine print terms of the new card so that you are aware of exactly what the new higher rate will be in the future and do not suffer any set backs to your debt consolidation plan. The “empty card” syndrome: If you have decided that moving your high rate balance to a lower rate card will help you to consolidate your credit card debt, make sure you have a plan for that new zero balance card. Do not become a victim of the “empty card” syndrome. Many people will find themselves back to square one and in debt by charging again on their zero balance card only because of the convenience and the zero balance. Do not let your mind trick you into this type of mentality,you will only be struggling with more debt and fail in your debt consolidation plan. One option is to make that card disappear from site as you are less likely to use it, if it is not easily accessible.
In other words,out of sight is out of mind. If you don’t see the card, you will not use the card and therefore will not defeat the purpose of consolidating your credit card debt. If you consolidate credit card debt by moving a high balance to a lower interest rate card be alert to the drawbacks of empty card syndrome and the teaser rates of the new card. Credit and debt must be managed responsibly, otherwise you will find yourself in a grave financial dilemma.