The majority of Americans have more debt than actual money. Scary as it is, the reality of the situation is quite dismal and most indebted individuals find themselves with their heads down due to a seemingly lacking availability of options. But, there are certainly financial measures one can take to stop moping around, put that head upright once again and begin a more structured and less negatively driven financial status. If one feels that they are drowning in a sea of debt, consider initiating debt consolidation to better position one's self financially.
What Is it? What Does It Involve?
Debt Consolidation is a process involving the combining or consolidating of one's debts -whether they be in the form of personal loans, home equity loans, mortgage debt, credit card debt, car loans or other financial liabilities- into a single loan. Basically, the individual in debt is in essence accumulating all of his or her debt by taking out one loan to pay off all debts together, as one large sum or whole.
This is usually done with intent to achieve a lower monthly payment that can be extended over time, as to pay off debt through one vein and in one go gradually over a set amount of years. And if carried out properly, debt consolidation can and most certainly will lower one's annual interest rate and/or monthly payments, hence providing more available income month to month.
Problems After Consolidating
After going through debt consolidating, most people will start having some serious problems. These problems though are all self-driven and spurred by financial irresponsibility. As it stands, a much larger percentage of debt consolidators will swell back to their original levels of debt almost immediately after consolidating. Why? Well, for one, after consolidating some individuals, for whatever their reasoning, will go out and have a shopping bonanza, even to the point of maxing out credit cards. This though, is completely avoidable and can be dodged through sound financial behavior come post-consolidation.
Avoid Poor Financial Habits
To avoid bad financial habits and adding to the already established 66 percent or more of post-consolidators who accrued more debt they just "eliminated," there are a few tricks one can consider - but rather and much more recommended - adopt and utilize. Mainly, what needs to be formulated is a sense of stable and mature financial responsibility. Without this, attempting to avoid debt once again will prove more exhausting than anything.
Firstly, spend less. It's that simple. Spending less money by staying home to eat and even buying non-brand name brands at stores can help reduce living costs. Think economical here. Don't spend money when you don't need to. Even establish a budget, one outlining monthly expenditures and savings amounts. This will allow one to monitor their individual financial situation and tweak it as they see fit.
Be among the minority of Americans and possess financial soundness. Having no debt is possible, it's just a matter of having financial responsibility and fostering a well-rounded sense of spending well and not beyond one's means. By having no debt, one can have a financially free life and, isn't that what anyone wants in the long run anyway? So, what's the hold up? Begin debt consolidation now if one is caught in a financial tight spot, but maintain composure afterward with monetary matters.
Sunday, February 3, 2008
The Best Student Loan Consolidation Will Save You More Than Money
Having finished your coveted college degree with sheer determination and some help from your student loans, you have to make sure that you handle your finances well. You have to remember that the way your financial management works, in and out of school, has consequences that your credit history and credit score will retain.
Everybody knows the importance of having a well kept financial rating. In addition everyone knows that a credit score drops faster than it can go up. It will also take years and years of exemplary financial management again in order for you to get back on track of a good credit rating. That is the reason why for students who have multiple student loans, they need to search for the best student loan consolidation package available.
Graduates and students who are looking for the student loan consolidation are usually those who have incurred more than one student loan in their quest to finish their college education. If you think that funding a college education stops once you have paid for the tuition fees, then you might as well think again. There are more educational necessities which sustain a college student. Among them are dorm rent, meals, transportation and books as well as those unplanned for out of the blue miscellaneous expenses.
Albeit the fruit of having a college degree is sweet, students need to plan ahead on how they can manage the existence of multiple student loans. Hence, searching and applying for the best student loan consolidation should be a priority. The process involves the merging of several student loans into one major account with one interest rate. In loan consolidation, the monthly repayments may be lowered considerably..
In addition you can frequently find a lower interest rate when consolidating your student loans. Of course this will also help to lower your monthly loan payment as well.
Everybody knows the importance of having a well kept financial rating. In addition everyone knows that a credit score drops faster than it can go up. It will also take years and years of exemplary financial management again in order for you to get back on track of a good credit rating. That is the reason why for students who have multiple student loans, they need to search for the best student loan consolidation package available.
Graduates and students who are looking for the student loan consolidation are usually those who have incurred more than one student loan in their quest to finish their college education. If you think that funding a college education stops once you have paid for the tuition fees, then you might as well think again. There are more educational necessities which sustain a college student. Among them are dorm rent, meals, transportation and books as well as those unplanned for out of the blue miscellaneous expenses.
Albeit the fruit of having a college degree is sweet, students need to plan ahead on how they can manage the existence of multiple student loans. Hence, searching and applying for the best student loan consolidation should be a priority. The process involves the merging of several student loans into one major account with one interest rate. In loan consolidation, the monthly repayments may be lowered considerably..
In addition you can frequently find a lower interest rate when consolidating your student loans. Of course this will also help to lower your monthly loan payment as well.
Saturday, February 2, 2008
An Unsecured Debt Consolidation Loan Can Help Salvage Bad Credit
When it comes to getting rid of existing debts, nothing works as well as a debt consolidation loan. However, even amongst the range of loans in the market, the unsecured type seems to work the best in salvaging a poor credit history.
What it is
An unsecured debt consolidation loan is essentially one which does not necessitate the need for any collateral. This is unlike a secured loan which requires you to show some form of collateral like the house or some such asset. This can prove to be a great relief for someone who is desperately trying to get out of debt and happens to have a poor credit history. However, while this can be a boon, it also comes along with certain drawbacks.
Higher risk
The very fact that you don't need to present any upfront collateral in an unsecured debt consolidation loan makes lending institutions perceive it as a high risk venture. Hence the resulting interest rate on the loan is definitely much higher than what you would ideally pay on a secured loan type. However, as a borrower, it is up to you to negotiate and bargain to try and extract the best possible interest rate out of the unsecured loan.
Consolidating multiple payments
If you are currently steeped in debt, then chances are that you must be paying high amounts on multiple liabilities. Outstanding balances on credit cards as well as existing loans etc. can eat into your finances. Hence in such cases, it offers you a way of consolidating all these multiple payments into a single payment. This saves you the hassle of remembering due dates for multiple bills and allows you to remember details of just one single payment each month. Plus usually since interest rates are much lesser than regular liabilities, you save much more.
Multiple interest rates
One other drawback with having to pay multiple payments is that you also need to keep track of different interest rates. While your credit card outstanding balances might have a certain interest rate on them, the loans may have another interest rate. Keeping track of all these varying rates can be a real hassle. That is why an unsecured debt consolidation loan can work to your advantage. You just need to make one payment each month with a single interest rate, which is much easier to monitor. This also saves you unnecessary worry.
Scope to improve credit rating
A debt consolidation scheme allows a person in debt to improve his existing credit history. By rectifying past patterns of missed or delayed payments, a borrower can improve on the score. If existing liabilities have a history of delayed and late payments, then by consolidating your liabilities, you are able to keep better track of finances. Plus you also get to reduce the tenure of repayment by paying off the amount each month promptly. By improving your credit score, you stand much better chances at getting other credit offers. You may want to opt for a home loan or some other credit to pay off a much needed education etc.
What it is
An unsecured debt consolidation loan is essentially one which does not necessitate the need for any collateral. This is unlike a secured loan which requires you to show some form of collateral like the house or some such asset. This can prove to be a great relief for someone who is desperately trying to get out of debt and happens to have a poor credit history. However, while this can be a boon, it also comes along with certain drawbacks.
Higher risk
The very fact that you don't need to present any upfront collateral in an unsecured debt consolidation loan makes lending institutions perceive it as a high risk venture. Hence the resulting interest rate on the loan is definitely much higher than what you would ideally pay on a secured loan type. However, as a borrower, it is up to you to negotiate and bargain to try and extract the best possible interest rate out of the unsecured loan.
Consolidating multiple payments
If you are currently steeped in debt, then chances are that you must be paying high amounts on multiple liabilities. Outstanding balances on credit cards as well as existing loans etc. can eat into your finances. Hence in such cases, it offers you a way of consolidating all these multiple payments into a single payment. This saves you the hassle of remembering due dates for multiple bills and allows you to remember details of just one single payment each month. Plus usually since interest rates are much lesser than regular liabilities, you save much more.
Multiple interest rates
One other drawback with having to pay multiple payments is that you also need to keep track of different interest rates. While your credit card outstanding balances might have a certain interest rate on them, the loans may have another interest rate. Keeping track of all these varying rates can be a real hassle. That is why an unsecured debt consolidation loan can work to your advantage. You just need to make one payment each month with a single interest rate, which is much easier to monitor. This also saves you unnecessary worry.
Scope to improve credit rating
A debt consolidation scheme allows a person in debt to improve his existing credit history. By rectifying past patterns of missed or delayed payments, a borrower can improve on the score. If existing liabilities have a history of delayed and late payments, then by consolidating your liabilities, you are able to keep better track of finances. Plus you also get to reduce the tenure of repayment by paying off the amount each month promptly. By improving your credit score, you stand much better chances at getting other credit offers. You may want to opt for a home loan or some other credit to pay off a much needed education etc.
Higher Education and Debt Consolidation
Higher education costs have almost skyrocketed in last few decades. So education requirements are often more than one loan. Students are sometimes employed but receive very low salaries at entry level and they are left with staggering debt burdens.
Even though they possess considerable talent they are unable to pursue higher educational needs because of their financial situations at home. If they desire to continue their education then they have to apply for student loans that are an additional cost burden to the family and the student who do not have the financial capacity to repay the loans.
Federal student loans for debt consolidation have been designed to help the students by combining all their debts into a single loan to be paid monthly. This makes their life more easy and they do not have to live in the threat of debt burdens just when their careers are about to start.
These loans are designed to tailor to the needs of different student from different background and challenges. So there is one best deal for each one of those who apply for such loans. Each of these loan packages designed distinctly exhibit diverse interest rates.
Applying for federal student loan consolidation requires a little bit of research on the net. There are many online links that offers excellent consolidation opportunities for students.
A Federal student loan consolidation bears lower interest rate and makes repayment a much easier task for students. This loan does not require a co-signer. No credit check is performed from the lending agency while approving this loan.
This Federal consolidation loan does not have hidden charges or processing fees during the time of application and over the loan period. Penalties for early repayment are also never charged.
Before you choose your lender you just need to know your package very well. You also need to know the kind of support your lending agency is going to provide over the loan period. If you have other loans with one lender then it is best that you approach the same lender to consolidate your existing loans into a single federal consolidation loan.
Choosing the lender is definitely important to ensure that you are offered the best deal at competitive market rate and you need to worry about your credit reporting status. Please ensure that your lending agency reports your timely payment to the credit bureaus and your credit score is up to date. Otherwise there is no point choosing a lender who is reluctant to do so and in this process your credit history gets marred even before it is created properly.
Even though they possess considerable talent they are unable to pursue higher educational needs because of their financial situations at home. If they desire to continue their education then they have to apply for student loans that are an additional cost burden to the family and the student who do not have the financial capacity to repay the loans.
Federal student loans for debt consolidation have been designed to help the students by combining all their debts into a single loan to be paid monthly. This makes their life more easy and they do not have to live in the threat of debt burdens just when their careers are about to start.
These loans are designed to tailor to the needs of different student from different background and challenges. So there is one best deal for each one of those who apply for such loans. Each of these loan packages designed distinctly exhibit diverse interest rates.
Applying for federal student loan consolidation requires a little bit of research on the net. There are many online links that offers excellent consolidation opportunities for students.
A Federal student loan consolidation bears lower interest rate and makes repayment a much easier task for students. This loan does not require a co-signer. No credit check is performed from the lending agency while approving this loan.
This Federal consolidation loan does not have hidden charges or processing fees during the time of application and over the loan period. Penalties for early repayment are also never charged.
Before you choose your lender you just need to know your package very well. You also need to know the kind of support your lending agency is going to provide over the loan period. If you have other loans with one lender then it is best that you approach the same lender to consolidate your existing loans into a single federal consolidation loan.
Choosing the lender is definitely important to ensure that you are offered the best deal at competitive market rate and you need to worry about your credit reporting status. Please ensure that your lending agency reports your timely payment to the credit bureaus and your credit score is up to date. Otherwise there is no point choosing a lender who is reluctant to do so and in this process your credit history gets marred even before it is created properly.
Friday, February 1, 2008
How To Use Debt Reduction Consolidation Services
It is hard to get through life with out attaining some debt. It is very rare to have all of the money for your first house, your education, or for vehicles without borrowing some. It is helpful to have the smallest burden possible when paying back these things. Debt reduction consolidation services can help.
The first thing that these services will do is give you expert advise and counseling on debt management. You will gain insight from their credit education. They will teach you how to live a debt free life. They will explain the best way to get out of debt, and the best options for repayment plans of loans.
Don't worry, the people giving this advise are not trying to sell you something in particular. They are financial professionals, and are not in the sales department. They truly have your best interest in mind. The techniques that they'll suggest are aggressive and can help you very much.
The main two choices for eliminating debt are bankruptcy chapter 7 and debt settlement. Bankruptcy will eliminate all debts, but it will take all of your assets as well (to pay back as much of the debt as possible). In addition, it will ruin your credit score. As a last resort, it can be used. It is quite difficult to meet eligibility requirements for chapter 7, however.
The other option is debt settlement. It will consolidate your debt and lower the overall amount by at least 40%. Paying back only 60% of what you would have to pay if you didn't do debt settlement is a huge help. Through consolidation services, 30-45% of what you owe can be saved, if it's done within three years.
The range of people from those with bad credit to the average consumer who run into debt problems is not unusual. None of us were born with the knowledge and ability to understand money and managing it. Money management is something everyone must learn.
Individuals who receive their pay sporadically like once per month or commission based pay can quickly see the end of their money before their next check arrives. They typically turn to their credit card as their way to cover the shortfall of cash.
The first thing that these services will do is give you expert advise and counseling on debt management. You will gain insight from their credit education. They will teach you how to live a debt free life. They will explain the best way to get out of debt, and the best options for repayment plans of loans.
Don't worry, the people giving this advise are not trying to sell you something in particular. They are financial professionals, and are not in the sales department. They truly have your best interest in mind. The techniques that they'll suggest are aggressive and can help you very much.
The main two choices for eliminating debt are bankruptcy chapter 7 and debt settlement. Bankruptcy will eliminate all debts, but it will take all of your assets as well (to pay back as much of the debt as possible). In addition, it will ruin your credit score. As a last resort, it can be used. It is quite difficult to meet eligibility requirements for chapter 7, however.
The other option is debt settlement. It will consolidate your debt and lower the overall amount by at least 40%. Paying back only 60% of what you would have to pay if you didn't do debt settlement is a huge help. Through consolidation services, 30-45% of what you owe can be saved, if it's done within three years.
The range of people from those with bad credit to the average consumer who run into debt problems is not unusual. None of us were born with the knowledge and ability to understand money and managing it. Money management is something everyone must learn.
Individuals who receive their pay sporadically like once per month or commission based pay can quickly see the end of their money before their next check arrives. They typically turn to their credit card as their way to cover the shortfall of cash.
How To Work Out Your Finances With A Debt Consolidation Loan
Most people struggle all their lives just to get out of debt. No wonder then that more and more people are turning to a debt consolidation loan to help get rid of their existing liabilities. Here are some ways in which consolidating your debt can help you get control over your money!
Relaxed payment terms
One of the best advantages of a debt consolidation loan is that it allows you to leverage a better payment pattern from the financial lender. Typically all existing liabilities will have quite a stringent set of rules regarding repayment etc. However, since such loan scheme is primarily targeted at people with high debts, the repayment terms are far more relaxed. This offers a way for the borrower to pay off debts over a longer duration at much lower rates. Besides this, existing penalties are also removed by the lender.
Single payment
If you have been tired of keeping track of multiple monthly payments and remembering due dates for every bill, then a debt consolidation loan can come to the rescue! Such schemes serve to do away with multiple payments and instead replace it with just a single payment each month. What this means is that you won't have to keep track of all those payments every month and just need to remember the details for one payment. This results in lesser chances of paying late or incurring associated late fees.
Lower interest rate
Instead of paying excess amounts on individual bills every month, a debt consolidation loan offers you a consolidated payment at much lower interest rates. This can save you plenty of money in the long term and also help you get out of debt much faster. The savings incurred because of a reduction in interest is one main reason people are turning to consolidating their debts more than ever before. Considering the existing scenario, managing and paying off individual debts would seem almost impossible. However, with a debt consolidation scheme this is very much possible.
Secured or unsecured
There are primarily two kinds of a debt consolidation loan - one is the secured loan where you need to provide some sort of collateral as security. The other is the unsecured loan. One reason this is good is because it results in a much lower rate of interest. However, it also means incurring some amount of risk because if you are unable to pay up the amount, the collateral gets confiscated. On the other hand the unsecured loan does not require you to provide any collateral upfront. However, the interest rate is much higher than a secured loan.
Relaxed payment terms
One of the best advantages of a debt consolidation loan is that it allows you to leverage a better payment pattern from the financial lender. Typically all existing liabilities will have quite a stringent set of rules regarding repayment etc. However, since such loan scheme is primarily targeted at people with high debts, the repayment terms are far more relaxed. This offers a way for the borrower to pay off debts over a longer duration at much lower rates. Besides this, existing penalties are also removed by the lender.
Single payment
If you have been tired of keeping track of multiple monthly payments and remembering due dates for every bill, then a debt consolidation loan can come to the rescue! Such schemes serve to do away with multiple payments and instead replace it with just a single payment each month. What this means is that you won't have to keep track of all those payments every month and just need to remember the details for one payment. This results in lesser chances of paying late or incurring associated late fees.
Lower interest rate
Instead of paying excess amounts on individual bills every month, a debt consolidation loan offers you a consolidated payment at much lower interest rates. This can save you plenty of money in the long term and also help you get out of debt much faster. The savings incurred because of a reduction in interest is one main reason people are turning to consolidating their debts more than ever before. Considering the existing scenario, managing and paying off individual debts would seem almost impossible. However, with a debt consolidation scheme this is very much possible.
Secured or unsecured
There are primarily two kinds of a debt consolidation loan - one is the secured loan where you need to provide some sort of collateral as security. The other is the unsecured loan. One reason this is good is because it results in a much lower rate of interest. However, it also means incurring some amount of risk because if you are unable to pay up the amount, the collateral gets confiscated. On the other hand the unsecured loan does not require you to provide any collateral upfront. However, the interest rate is much higher than a secured loan.
Thursday, January 31, 2008
Wealth Through Elimination of Debt
Not too long ago, I was constantly looking for ways to increase my income just so I could improve my lifestyle temporarily. Working extra hours so I could go out on the weekend more often. Or taking odd jobs so I could afford to get a cool new cell phone. It took me a long time to realize that I was getting virtually no where financially and if I didn't keep busy at all times I would begin to fall behind on my bills, or overspending one week would set me back for months. I was constantly working to afford my lifestyle.
If my previous situation sounds like what you're going through now, you're in luck. Now is the perfect time to get out of debt and to start acquiring wealth. Now is the time you should be cutting back on your expenses in a big way. For me gas and the cost of going out had to be cut down dramatically. I simply didn't go out some weekends and instead spending the extra time developing my business. I then went over all my credit card and bank statements for the last 6 months and canceled any subscriptions I wasn't aware of. Somehow I ended up with subscriptions to about 6 magazines that I don't remember signing up for. This saved me $80. $80 doesn't seem like a lot but it's just enough to pay for small expenses.
Cutting down on expenses means cutting down on credit card payments. I was able to do this with little hassle by canceling all my cards. Even the ones with balances on them. After I canceled my monthly payments dropped dramatically. I made my goal to pay of 25-50% of my total balance every month and I was out of credit card debt in no time.
Many people are assumed to be wealthy because they have the nicest car in the neighborhood and you always spot them sitting in front of their big screen. This is very untrue. Many people living with all the extra luxuries often times actually deep in debt and have no wealth at all. Just possessions and debt. Acquire enough wealth so you don't have to trade your time for money at a day job. Eventually you should be able to live off the wise investments you made months, years, or even decades later.
Start acquiring wealth now. The longer you are able to hold healthy financial habits, the easier it gets to acquire wealth. As you make more progress and make more and more smart investments, managing your money is no longer a chore but rather an opportunity to expand your wealth without risk to your lifestyle.
If my previous situation sounds like what you're going through now, you're in luck. Now is the perfect time to get out of debt and to start acquiring wealth. Now is the time you should be cutting back on your expenses in a big way. For me gas and the cost of going out had to be cut down dramatically. I simply didn't go out some weekends and instead spending the extra time developing my business. I then went over all my credit card and bank statements for the last 6 months and canceled any subscriptions I wasn't aware of. Somehow I ended up with subscriptions to about 6 magazines that I don't remember signing up for. This saved me $80. $80 doesn't seem like a lot but it's just enough to pay for small expenses.
Cutting down on expenses means cutting down on credit card payments. I was able to do this with little hassle by canceling all my cards. Even the ones with balances on them. After I canceled my monthly payments dropped dramatically. I made my goal to pay of 25-50% of my total balance every month and I was out of credit card debt in no time.
Many people are assumed to be wealthy because they have the nicest car in the neighborhood and you always spot them sitting in front of their big screen. This is very untrue. Many people living with all the extra luxuries often times actually deep in debt and have no wealth at all. Just possessions and debt. Acquire enough wealth so you don't have to trade your time for money at a day job. Eventually you should be able to live off the wise investments you made months, years, or even decades later.
Start acquiring wealth now. The longer you are able to hold healthy financial habits, the easier it gets to acquire wealth. As you make more progress and make more and more smart investments, managing your money is no longer a chore but rather an opportunity to expand your wealth without risk to your lifestyle.
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