Debt Consolidation

Custom Search

Debt Consolidation
Debt Relief
Debt Consolidation Company
Debt Help -
Reduce Your Debt
Bad Credit Debt
Personal Debt Consolidation
Debt Consolidation -
Deciding To Consolidate
Debt Management Plans
Online Debt Consolidation
Debt Consolidation Help-
Student Loan Consolidation
An Overview of
Debt Counseling
Debt Reduction Program
Design Cheap Debt
Guide to Unsecured
Debt Management Plans
Consolidation Loan Student
Is a Student
Debt Relief --
Debt Management gives
Begin The Debt
Free From Debt
Get Rid of
Beating Debt with
4 Debt Reduction
Consolidate Your Government
Bad credit debt
How To Do
Debt Elimination Program
Debt Management Plan
Debt Reduction Program
Unsecured Debt Consolidation
Debt Recovery Solutions
The Time To
Debt Consolidation
Debt Relief
Consolidation Loans - Savior or Poison?
by Steve Faber
If you have multiple high interest credit cards and other financial obligations, debt consolidation or some other debt management strategy may be in order. As you are by now aware, with a debt picture that includes so many high interest obligation

If you have multiple high interest credit cards and other financial obligations, debt consolidation or some other debt management strategy may be in order. As you are by now aware, with a debt picture that includes so many high interest obligations, you are soon paying minimum or close to minimum payments every month. This is just to make your interest payment. Little or none of your monthly payment contributes to principal reduction. Your loan or card principal shrinks very slowly. It often takes years to pay off such debts, if they are ever paid off. Many people just keep their cards and other revolving accounts maxed out. If they ever pay them down, they charge them right back up again in short order.

You have several options, one of which is debt consolidation. Debt consolidation entails using a consolidation loan to pay off all your credit card and other high interest loans such as car loans and store charge cards. The consolidation loan has a lower, usually much lower, than the other loans.

You can potentially get several advantages from this debt reduction strategy. This assumes you stop using the credit cards. If you dont stop, eventually youll have the consolidation loan and new credit card debt to pay off. You now have less or no equity in your home to use as collateral, so you usually cannot get another consolidation loan. Even if you could, you must change your spending or you could end up losing everything. Some of the advantages of using a debt consolidation loan:

• Youll pay off your debts and loans more quickly. This is because of the (usually) much lower interest rate on the consolidation loan. You must stop using your credit cards for the faster payoff to work.

• Youll have a lower monthly payment. In some cases it could be less than half the original amount you were paying every month on your credit cards. Its because of the lower interest rate your monthly payment will be so much less. Most of your monthly credit card payment is for interest, not principal.

• Youll usually pay far less total interest. This depends upon on the combined rate of your credit card debt, the rate of the consolidation loan, and the term of the consolidation loan. If you have a large consolidation loan with a very long term, you could still wind up paying substantial interest over the term of the loan, even if your monthly payment is fairly low. That is because you are paying on the loan for such a long period of time. Make sure your payments are low because the interest rate is lower than your credit card interest rate, not because your loan term is long.

• It is much easier to make one monthly payment than many. The convenience alone is a substantial benefit. However, there is another benefit too. The more payments you have to make, the greater odds you will misplace a bill or not be able to pay one. Many people wind up being late or missing a payment because they have so many credit card bills they lose or forget one of them. The late payment can trigger a clause in your credit card agreement that allows the lender to raise your interest rate. This creates another problem when your interest rate is raised, causing your monthly payment to rise yet again. In addition, the late payment can affect your credit score. Other lenders can use the change in your credit score to raise your interest rate on some of your other credit cards. You could wind up paying substantially greater interest rates on many of your cards.

These are some of the reasons a consolidation loan can be beneficial. They are not the right solution for everyone however. There are many different lenders with many different consolidation loans. You need to evaluate your situation thoroughly and look at all the many alternatives. You can then determine if one of the different consolidation loan products is the correct solution for you.

Steve writes about a multitude of topics from home theater and automation to credit, business and finance. See his website, The Debt and Loan Consolidation Guide for more information.

The site is not responsible for any content in it. E-mail: alldir[at]gmx[dot]com
debt consolidation, home loan, mortgage, debt free, debt help, refinance, equity loan, unsecured, secured debt, bankruptcy, credit card , bad credit, payday, cash advance, cash settlement, line of credit, student loan, interest rate, borrow money, car loan, adverse credit, compensation, quote, credit score, consolidate debt Pahapesto UT Henrietta township Dante town Pen Argyl borough Norris village Balance of Pontotoc County Asbury Bachelor township Laurel Springs borough Akron township Wilmore borough Balance of Jarvis township Leeds town Macedonia village (pt.) Sansom Park South Plainfield borough Elbow Lake township Balance of Madison County Holley village Carmel-by-the-Sea Knox borough Portland city (pt.) St. Regis Park Latty township Balance of Union township Balance of Sandy Creek town Hardy city (pt.) Prophetstown Todd County Newington town USA UK Australia Canada Fiji Saint Lucia Zambia Benin British Sovereign Base Areas Liberia Vanuatu Guam Lesotho Cocos (Keeling) Islands Monmouthshire Fermanagh Perthshire Down Clackmannanshire Sussex Kent Berwickshire Orkney Derbyshire Nevada (NV) Rhode Island (RI) South Dakota (SD) Utah (UT) Maine (ME) Marshall Islands (MH) Palau (PW) Montana (MT) Washington (WA) Nebraska (NE) Georgia (GA) Nevada (NV) Palau (PW) Iowa (IA) Michigan (MI) South Dakota (SD) Oregon (OR) Indiana (IN) Delaware (DE) Ohio (OH)