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How To Get Bad Credit Debt Consolidation Loans

December 4, 2011

Bad Credit Debt Consolidation Loans

If you are looking to consolidate your credit card bills or any other bills for that matter, but have credit that is a bit down in the dumps, you can still get bad credit debt consolidation loans. For those of you who aren’t familiar with the term consolidation loan, it is essentially when a company pays off your bills or pays your bills for you an then you pay them back in the form of one cumulative loan that is equal to the total of all the debt have. Often times these companies will renegotiate better terms as well lower debt totals, which can equate to you paying less interest as well as owing less, not to mention only having one payment to worry about instead of multiple.

bad credit debt consolidation loans

You can apply for a consolidation loan with bad credit, and often times companies with accept your business on good faith, but it comes with a price, and that is a higher interest rate as well as the possiblity of stricter repayment terms as well as not being able to enjoy other discounts you would enjoy with good credit. Below are alternative methods you can consider when looking for bad credit debt consolidation loans.

How  To Get Bad Credit Debt Consolidation Loans

1.)  The first method that is used most often when trying to attain a bad credit debt consolidation loan is to get a co-signer who has good credit. Now a tip to follow if you choose this method is to try to get a co-signer with a score of at least 750, if not higher. This will enable you to have better chances in getting a loan, as well as will most likely mean you getting a lower interest rate on the repayment terms. This also means that you must make payments as if you don’t your co-signers credit will be affected, but later on, usually about 24 months into the repayment on your consolidation loan with bad credit, you will be able to tranfer the debt into your name if you have made on time payments each month, enabling your to be able to build your credit score back up.

2.) If you have a home or car or other valuable assets, and are willing to use them as collateral, which is basically saying if you do not make the payment they can take the asset, then this will offer your a much better chance in qualifying for bad credit debt consolidation loans.

Alternative Options For Bad Credit Debt Consolidation Loans

While you are looking for bad credit debt consolidation loan lenders, you can consider and alternative option in the meantime, which you can consider:

  • Using a credit card to consolidate debt if you have bad credit. The benefit of this can be enjoyed when credit card companies offer low or no interest rates for a period of time, which then you would tranfer the balance of the debt in which you pay the highest interest on which will allow you to save money on interest payments for a short period of time.
  • The other option worth considering when looking for bad credit debt consolidation loans is taking out equity loan on your home to pay off your debt, which then you will only be paying on one debt total, the equity debt which is similar to paying a consolidation loan, as well as can come with lower interest rates because these loans are secured loans.

Debt Management Plan – Overview & Choosing A Good Company

November 26, 2011

Debt Management Plan

If you are unsure exactly what the point is of a debt management plan, it is basically a way to payback unsecured debt to creditors  whom you owe money to, which their goal is to get you out of debt as soon as possible, and as fast as 3 to 5 years. A debt management plan is used most often for situations like; payments that take up a large portion of your monthly income, late payments as well as when one is feeling overwhelmed with their payment plans.

debt management plan

When an individual finds themself in one of these situations they seek a third party organization who will review your particular situation and assess what can be done to help you start to gain control over what you owe. In order to do so, these organizations will assess aspects of your situation like your budget as well as your monthly and yearly income, then the organizations will attempt to renegotiate terms like how much you owe each month as well as lower interest rates. During this process they will use your income as well as the budget to create more realistic repayment terms which fit well with both the organization as well as the individual in debt.

After debt management plans are pitched to your creditors, they can either accept to regnegotiate or decline, which for the most part, they usually agree to new terms, as it will be a step forward either not being paid or always recieving late payments. When a DMP is accepted, one of the main benefits is that after a certain amount of time, you will no longer be harrassed with calls by your creditors anymore, which the calls usually cease about 1 to 3 months after one has started their debt management program.  To get your more familiar with the rules and terms of being in a debt management program, below are some of the main aspects of the DMP customer experience:

  • You do not have to include all of your debt into your debt management plan if you do not want to.
  • You can use a managment plan even if you haven’t missed a single payment, and still enjoy the benefits.
  • The DMP continues until your are completely free from debt.
  • You can also receive helping in better budgeting your expenses which is administered through a debt counseler.
  • Remember to check your statement each month to make sure your debt is being paid off to your creditors.
  • Activation fees can be reduced through negotiation, per say if you cannot afford the fee, which monthly fees are negotiable as well.

Debt Management Plan Tips

Below are details on tips that you can choose to follow which will make sure you are getting the best deal as well as avoiding scams:

  • Avoid organizations that do not pay their employees based off of whether or not they enroll you in a debt management program.
  • Get everything that needs to be signed in writing, like terms and legal information, not over the internet or phone.
  • Never pay for information about a DMP company.
  • Find out if previous customers have been happy with the service, which can be done through your staes Attorney General or the Better Business Bureau.

It is also advised that you seek out a debt management plan from an organization that either small or medium sized organization, as they deal with less people then the likes of franchises, and they can offer more personalized service and tend to be a lot more dedicated. If you are considering using a debt management plan to get yourself out of debt, or at least get a handle on your debt situation, the best thing to do would be to contact an expert that specialized in debt management. Although it costs to consult in one of these experts, what you pay can be worth it’s weight in gold because they can assess you situation and provide guidance on whether using a debt management plan will work in your favor or not, or use another debt relief method like consolidation or settlement. This will also avoid organizations who are just trying to make a sale off of you, even though it may not provide value to your debt situation.

Debt Relief Act – The Credit Card & Mortgage Debt Relief Programs

November 4, 2011

Debt Relief Act

debt relief act

The Debt Relief Act, also known as the the Credit Card Debt Relief Program and Obama’s Debt Relief Act among many others, was founded by President Obama in 2009, as a way for individuals who have over 10,000 dollars of unsecured credit card debt, to receive relief in the form of a large percentage of their debt essentially wiped away. The total amount that Obama set aside for the Debt Relief Act was 797 billion dollars which the sole purpose was to stimulate the US economy due the millions of people who were laid off and as a result had to use credit card resulting in debt . The percentage of debt forgiven can be up to 50 to 70 percent of the entire debt total and was founded with the mission of reducing financial burdens placed upon Americans, as well as provide a reputable as well as credible source of debt relief being that there are so many scams out there.

How Debt Relief Act Funds Are Distributed

In order to begin the Debt Relief Act, the money for the program was disbursed in the form of tax rebates to firms as well as debt collectors, who were in a frenzy over delinquent account and were looking for an alternative when it came to getting their debtors to pay their debt off. Being that these corporations now have this extra funding, they can now offer to those who are paying their debts to them, debt settlement in which their debt is cut by a large percentage and only have to pay now on a fraction of the original sum.

How Consumers Can Benefit From The Debt Relief Act

If you happen to have credit card debt that has exceeded the total of 10,000 dollars and are looking to benefit from this revolutionary program, the best thing to do now would be to meet with a reputable credit card settlement company and inquire through them about using the Debt Relief Act for your personal situation.

 

MORTGAGE DEBT RELIEF ACT

The Mortgage Debt Relief Act was started in 2007 and focused on offering a remedy to the traditional rule that you must be taxed on any amount of mortgage debt that was forgiven from the lender that you borrowed from. This act is specifically for those who had debt forgiven due to foreclosure as well restructuring mortgages, in which borrowers used the cancellation of their mortgage debt to either; to purchase, build, make improvements to the home as well as and debt the resulted from these actions, as well as certain cases of one refinancing their home. Under this new debt relief act, the individual who received forgiveness on mortgage debt, no longer had to pay tax on up to 2 million dollars of forgiven debt, or 1 million if a couple is filing separately from one another. The program is set to run through 2008 to 2012 and specifically states that one can claim any amount of money that was lost on either the sale as well as the foreclosure of the home.

Credit Card Debt Consolidation – Can It Help Your Get Out Of Debt?

October 19, 2011

Credit Card Debt Consolidation – How It Can Help

If your credit card debts continue to grow and you are already very desperate to find the most effective way to deal with it, then you have to know that credit card debt consolidation can be of huge help to you. This method is most suitable for you if you have more than one credit card and the balances in each card are already extremely overwhelming. Instead of being alarmed and trying to start hiding from your creditors, you should consider getting the service of a credit card debt consolidation company. This will increase your chances of preventing the major consequences of huge credit card debts such as receiving incessant calls from your creditors and the possibility of being sued.

credit card debt consolidation

When attempting to avail of the best credit card debt consolidation service, you have to spend time checking out your financial health. This is considered to be one of the greatest factors that determine the kind of debt consolidation service that you need. Financial health can actually be defined as the future probability of getting all of your credit card bills paid. You can expect to have a good financial health if there is a great possibility that you will be earning more in the future. This is something that you need to greatly consider when trying to get the service of a credit card debt consolidation company.

Credit Card Debt Consolidatoin Benefits

Credit card debt consolidation can be expected to offer a lot of advantages including the following:

 

  • Decreased amounts of monthly payments. If you decide to get the service of a reliable credit card debt consolidation company, then expect the amount that you need to pay every month to be reduced. This is possible since this method allows you to pay off your credit card bills for a longer duration. This means that the total amount of your credit card debts will be divided based on the new payment period and this will make your monthly payments lesser.

 

  • Credit card debt consolidation can be easily managed. All it takes for you to receive the benefits of the method is to sign up an agreement with the company offering the debt consolidation service. After signing up, you can expect to obtain relief from having to read all of your credit card statements all the time. The company will consolidate all of your credit card debts and decide on your capability to pay. Based on your ability to pay, the credit card debt consolidation company will decide how much you will be paying each month and try hard to make negotiations to your creditors.

 

  • Decreased Rate of Interest. If you deal with an effective credit card debt consolidation company, then expect the rate of your interest to be reduced. The company will start to negotiate to your creditors to lower down your interest rates so you can easily pay off your remaining balances. Aside from helping you save a substantial amount of money, this is also useful in terms of easily managing your credit card debts.

 

  • An effective credit card debt consolidation service offers debt management tips. Aside from helping you deal with your current debts, you can also expect a reputable company to offer free tips that will help you easily manage your debts in the future. They will establish an effective debt management plan for free and you can use it in your future dealings with your debt.

 

How A Debt Management Program Can Get You Out Of Debt

September 23, 2011

Debt Management Program

If you have been thinking about participating in a debt management program, through a consolidation company or settlement service this is a must read  Many services advertise to you how great they can make your lives by customizing a debt management program for you, but do they really measure up? To get you familiar with debt management, we will introduce to you to the benefits and drawbacks of it so that you can get a bird’s eye view of what is really going on when it comes to participating in a debt management program.

debt management program

Debt Management Program Pros

Besides the fact that you will only have to pay one bill to one company, here are some of the benefits of using a debt managment program.

  • Lower interest rates and lower debt almost always come out of debt management. This through many ways liike it provides you with a secured loan you will pay on, or negotiates lower interests rates and lower debt totals with creditors among others. Debt managment programs can drop your interest as much as 10 percent or more. Lower interest rates also equate to lower monthly dues.
  • Debt management can also result in the re aging of your account that is delinquent, which is essentially reverting back your account to a time where you didn’t have any late fees or other fees. This can eliminate some or all the fees you have on your account.
  • Once you start your participation in a debt managment program, you will no longer receive any calls from creditors, as your debt managment company does all of the communication.
  • It prevents one from having to declare bankruptcy which will ruin credit scores for years.

CONS

  • When you pay off your debt on your debt management program, it shows up on your credit statement as a settlement and now a full pay off which can affect your credit score.
  • Some debt mangagement companies often times make late payments to creditors which results in late fees that you have to pay.
  • There is no guarantee that creditors will negotiate lower payment terms with debt management companies.
  • Smaller monthly payments are offered through a debt management program, which is done by extending to repayment term. This means being in debt longer as well as paying more interest. To avoid this, look for a company who allows you to pay more than the minimum without being hit with a fee, so you can pay more later when you can afford it.

How to Get the Best Debt Management Program

When looking for a good debt management program, a great tip to follow is to use a non profit organization. These organizations are funded by donations as well as from big businessses looking for writeoff, and have been known for lower fees and all together a better experience for clients. Be aware of organizations claiming they are non profit but aren’t. You can avoid these organizations all together by requestion proof of non profit which can be attained in the form of a (501(c)(3)) which is the proof of charitable status.

In conclusion, debt managment programs aren’t for everyone and should be used only for people who are having trouble paying their monthly payments, are making late payments or have stopped paying all together. Before starting a debt managment program, you can also contact your creditors and try to negotiate something that better suits your particular situation.

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