What do you know bout debt consolidation? You may have many smaller debts that are causing monthly chaos. It’s now time to put a stop to the chaos, and a debt consolidation company is a good first step. The information that follows will help you figure out what your next steps should be.
Do you own a life insurance policy? You can cash it in and pay off your debts. Get in touch with your insurance agent and determine the amount of money you can obtain against your policy. Sometimes you can pay your debt by borrowing a portion of your investment.
Find out if bankruptcy is an option for you. It can be Chapter 7 or even 13, but it will ruin your credit. Although you’ll receive a bad mark, bankruptcy may benefit you if you cannot pay your debt off. If you cannot make payments, your credit is probably not the greatest and a bankruptcy won’t make it much worse. A bankruptcy filing will help you reduce debt and regain financial control.
Find out how a company is calculating your interest rate. It is always best to choose an interest rate that is fixed. That means you will understand how much you will pay in total. Debt consolidation loans with adjustable interest rates need to be avoided. Eventually, you will be paying more interest than you did in the beginning.
If you are a homeowner in need of debt consolidation, consider the possibilities of refinancing your mortgage and using the money for debt relief. Mortgage rates have been low lately, and that means now would be a great time if you’d like to consolidate the debts you have this way. You may be surprised by how low your house payment will be, too.
It is good news that your credit rating is generally unaffected by debt consolidation. Some other debt reduction options will affect your score adversely, but a loan for debt consolidation is mostly just for lowering interest rates and reducing the number of bills you’re paying. This can be a powerful tool if you follow the plan carefully.
You might be able to remove some money from your retirement fund to help you get your high-interest credit cards paid off. It’s crucial that you pay back any money to your fund that you take out, though. You have to pay taxes and fees for a penalty if this doesn’t occur.
When doing a debt consolidation, figure out which debts should be included and which debts should be kept separate. If you already have 0% interest loans, you don’t want to consolidate them. Review each of your current loans with the lender to assure you are making good choices.
With your options explored, now you can choose your fate. This is a decision that should be made carefully and to fit your specific situation. You will soon be out of debt if you implement efficient strategies. You will no longer be consumed by your debt; you will once again be able to enjoy life!