Getting a Debt Consolidation Loan

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Benefits of a Debt Consolidation Loan

Are you carrying more that one mortgage, a car loan and credit card debts? Chances are they are at different interest rates with different terms and that you are wasting money every day you leave all those loans out there. You should really consider getting a debt consolidation loan and combining all of your payments into one. Of course, if you can't secure an interest rate for your debt consolidation loan that is lower than your credit card or your car loan, it may not be worth it. You should do the math yourself or seek the advice of a financial consultant to find the best debt consolidation loans for your situation.

Student Loan Debt Consolidation – A No-Brainer

College brings student loan debt, of that there is no doubt. Once you graduate, hopefully you won't be buried in student loan payments but if you are, you should consider debt consolidation to make things simpler and cheaper. Student loans traditionally have lower interest rates anyway, but when you consolidate them you'll have only one payment and you'll most likely be able to secure a lower interest rate. You do need to remember that the government will only allow you to consolidate your student loans one time. You should wait until the interest rates are optimal before you move forward with the consolidation. Once you have though, the single payment, lower interest rate and the new term will mean lower monthly payments and a lot of money saved!

3 Tips to Selecting Debt Consolidation Services

Here are three tips on choosing the right debt consolidation service provider:

  1. Get References – Lenders and mortgage companies have to jump through a lot of hoops to gain accreditation and many of the work hard to maintain a high level of customer satisfaction. Make sure your lender is accredited by a third party and make sure they have no blemishes on their record with the Better Business Bureau. You can also check with your own state consumer affairs bureau to ensure the lender is on the level.
  2. Comparisons – Make sure you get multiple quotes and compare them. Donít jump at the first rate and term you get. Feel free to play lenders off one another before you choose. You need to get the best deal for your own financial future.
  3. Who Will Save You The Most Money– At the end of the day, the purpose of this loan is to get you out of debt. Choose the debt consolidation loan that is going to cost the least amount of money in the long term. This means the lowest interest rate with a reasonable term.

Bill Consolidation Services for Everyone

Debt consolidation has evolved into an industry because millions of people are tired of writing checks to dozens of creditors every month. Bill consolidation services exist to take care of the headaches of monthly bills. You pay them one fee and they take care of the hassle.

Can such a service be trustworthy? They offer guarantees that your bills will be paid on time but what if they fail? There is no easy answer to these questions.

Bill consolidation may be a better answer for you than a bill paying service. If you can pay one bill each month rather than ten then you are far more likely to be successful. Get references and check their business credentials when you choose any company that will be handling your personal information. Be careful, but seek help.

Choosing a Consumer Debt Consolidation Company

You keep hearing about what you need to look for in a consumer debt consolidation company, from references, to BBB Online seals of approval, to comfort with their online security and all the rest. But what is a consumer debt consolidation company?

A consumer debt consolidation company's goal is to create a reasonable financial plan for you. They will have various suggestions and avenues you can take. They may even refer you to different consumer agencies to help you further.

The Better Business Bureau rates companies and businesses and that includes consumer debt consolidation agencies. They list compliments and complaints from clients and vendors who have worked with the company. Check out company ratings and make sure that they are reputable and have no complaints.

Bring it All Together with Debt Consolidation Services

You can use a bad credit loan to improve your credit. It may seem odd that you can only improve your credit by taking on new creditors, but it's true. If you take out a bad credit loan and you are diligent in making your payments, you'll soon see your FICO score rise and your financial prospects begin to improve. The key is to be consistent in making your payments on time and eventually you'll get out of your bad credit hole. Bad credit loans, although sometimes expensive, are really worth it in the long run if you use them as a tool to move your financial prospects forward.

Now Is the Time for Debt Consolidation

Do you keep seeing ads for bad credit repair services? If you see services that say they can fix your credit immediately, they are not telling the truth. A reputable bad credit repair service will help you realign your debt and get into better money management habits, but credit repair does take time, no matter your situation. If you're patient and consistent, you can repair your credit score significantly over a couple of years, especially if you take out a bad credit mortgage or loan. Making timely payments to your mortgage company is the surest way to improve your credit. If you have to take a hit on the interest rate for a year or two, it will be worth it in the end. Forego dinners out so you can ultimately buy the house of your dreams with a low interest mortgage you get with your improved credit rating!

Getting a Fast Debt Consolidation Loan

Bad credit usually comes from bad habits. You may have gotten into a rut with credit card spending, or you may be hopeless at remembering to pay bills on time. Maybe you are bad at managing your check registry so you're always bouncing checks? All of these are simple bad habits that are easy to fall into and all can have serious long term ramifications forcing you into bad credit loans and credit repair. When you are overhauling your money management, don't forget to work on your bad habits. If you need to keep credit cards out of your wallet to avoid using them, than do that. If you need to set up automated payments, then take that step. Work on the problem, not just on the symptoms.

Bill Consolidation with a Home Equity Line of Credit

Rising home values have offered a lot of debt relief to homeowners across the U.S. Many have refinanced their home mortgages to take out equity or they have taken out a home equity loan to consolidate their bills.

A home equity loan is just as effective for bill consolidation as a debt consolidation loan would be. Home equity lines of credit are especially excellent for this purpose because they have very low interest rates and the term of the loan is usually generous.

If you are carrying a lot of debt and you own a home that has experienced a large increase in value, a home equity line to consolidate your debt is a great option. To figure out if it is the right option for you, consider the following:

  1. How much equity do you have in your home? Subtract your mortgage payment from the rough fair market value of your home. The FMV is typically assessed by comparing your home to ones like it that have sold recently.
  2. Consult your mortgage broker about debt consolidation loans or home equity lines or credit, or ask if there are any programs that cover both.
  3. Do get a couple of quotes while youíre out there assessing your options and make sure you seek consumer credit counseling to ensure you donít make the same mistakes again.

Consumer Debt Consolidation vs. Business Debt Consolidation

Personal debt consolidation and business bill consolidation are very different things. Many of us accrue personal debt in our lifetimes, but when a business builds debt and wants to consolidate it, there is more risk involved for the lender and this lends a level of complication to business debt consolidation that doesnít exist for individual debt consolidation.

When you open a business, the purpose is to bring in revenue and hopefully yield profits. If a business builds up a large amount of debt and is not covering expenses with revenues, the bank is going to want to understand why before they throw more money at the problem. Perhaps the company is expanding or there was a large cash outlay for a critical piece of equipment and with reasons like this, a bank is not going to deny a business loan to you. A lot of businesses with high debt to income ratios are being poorly managed and have overhead that exceeds their revenue possibilities - this is what banks want to avoid.

The bottom line is that business debt consolidation loans have very different rates and terms than those of personal debt consolidation loans. If you need a business debt consolidation loan, consult a reputable lender and see how they can help you regain control of your business debts.