Debt Consolidation Without Owning A Home — Is It Possible?
Although a home equity debt consolidation mortgage is often the cheapest form of debt consolidation, it is not your only option. This article discusses some other forms of debt consolidation loans:
Borrow Off Of an Investment Account
If you have a 401K or whole-life insurance plan, you may be able to borrow on the amount of money you've put into the account. However, it's important to remember that you're putting your life insurance or retirement plan at stake.
Transfer Your Balances to a New Credit Card
If you can find and get approved for a credit card with an introductory offer for low or no interest on balance transfers, you may be able to pay down a considerable amount of your principal before you are again charged interest. However, it is important that you then get rid of your other credit cards so that you're not tempted to use them now that they’re paid off.
Get a Personal Loan
Some companies offer unsecured personal debt consolidation loans to borrowers with debt problems. However, unsecured loans carry higher interest rates then secured loans. There will also be more limits. Even so, personal loans generally have lower interest rates than credit cards.
Seek Help with a Debt Management Company
Debt management services will work with you to create a monthly budget and negotiate lower interest rates and monthly payments with your creditors on your behalf. They will then take control of distributing your monthly payments to creditors; you simply send them one combined monthly payment. Debt management services cost a small monthly fee, but it may be cheaper than the interest you would pay on a loan.
Recommended Debt
Consolidation Companies:
Our Recommended Debt Consolidation Companies:
Bad Credit Loan Sources
- If you have less than perfect credit, you need this list
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Helpful Tips:
- Apply with more than one company to compare offers.
- Study your options before committing to a debt program.
- Cut out small luxuries to pay down debt at the beginning of your debt reduction program.
Debt consolidation companies vary in what types of consolidating solutions they offer. There are debt counseling companies, debt settlement and negotiation companies and debt management companies.
Debt Counseling - Debt counseling companies offer, usually, non-profit services to help you reduce the amount you owe on your debts. However this service may hurt your credit ranking. Talk to the company and find out if what they do will affect your credit ranking.
Debt settlement and negotiation - This is a process where a company will negotiate a lower payment or lower amount owed to the lender, on your behalf. Sometimes this can hurt your credit also. Debt settlement companies vary in their techniques. Before you choose a company, make sure you read through some reviews about that company before you start.
Debt Consolidation - Debt consolidation is where you take out a new loan in order to consolidate and pay off all existing debt. This usually lowers your overall payments and reduces the amount your paying every month. Not only does debt consolidation not hurt your credit, but it can actually help it.
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