Debt Problems

How would I go about trying to consolidate my debts? Should I go to a Debt consolidation place?

Public Comments

1. no they suck they take all your money and expect you to make a savings account while they hold back your creditors. When you have enough to pay a bill the interest on that bill is so high you end up paying more in debt because they try to hassle with your collectors. Most of them say they are non-profit but that is not true. Dont go to creditsolutions.com they ripped me off said I gave them 400 dollars a month to pay themselves for services and my creditors they only paid themselves
2. I woudn't reccommend a Debt Consolidation Company. They will take your money and mess up your credit, but will not tell you about your credit until they are done. If you need help lowering your bills visit my web site http://robertscredit.com/index_files/debt.htm we have help people from filing bankruptcy and lower monthly payments by half. Also we are a credit repair company, so we will help get your credit up to 700 where it should be. Please let me know if you have any other questions D Roberts answers@robertscredit.com
3. Shifting your debt isn't the answer. Work on paying off what debt you have, particularly if it's credit cards. All too often folks take out a loan to pay off credit cards then run the card right back up. Learn to live within your means. Make a stict budget. Get rid of all extras -- cell phone, eating out, new clothes, premium cable and internet, etc. Take every penny you can squeeze out of that budget and put it on the highest interest rate debt, while making minimum payments on the rest. When the highest debt is paid off, move to the next till they are all paid off. If you really have to consolidate, go to your bank and try to get a personal loan. Large, unsecured loans tend to be hard to get without a good credit score. They also tend to have higher interest rates -- some might even be more than the credit card interest. Debt consolidation companies will get you coming and going. They get their fees up front and sometimes trash your credit in the process of "negotiating" settlements of your debts.
4. I would be extremely careful about places like that. The problem is, while it makes it easier to clear your credit by making only one payment (which they take care of distributing), they don't distribute all of the payment you send them...instead, they keep a portion of it as their "monthly fee." And while your interest rate might be lowered on the credit cards themselves that you're paying, often this "monthly fee" that the consolidation agency charges means you end up paying out just as much, possibly even more...it's just that the extra accumulated interest goes somewhere else. You could easily do the same work that the debt consolidation agencies do. First, record the card number and service telephone number of each card, and then slice up all your cards. Next, call your credit card companies and negotiate for lower interest rates (they are usually more than happy to help you). Then, determine a set payment every month that you set aside to pay credit bills and don't use for anything else. Pay the minimum on all your cards, except for the lowest balance where you pay a portion significantly higher. Then when that card is paid off, add that payment to the card with the next lowest balance, still paying out the same amount of money each month. Keep this pattern going until all your cards are paid off. That's pretty much all that debt consolidation companies do; you should be able to do the same. If you feel, however, that it's a lot more convenient for you to let them handle the paperwork, then go ahead and check into companies. But be sure you check them out with the BBB to see if there are any complaints against them first.
5. Opt for a debt consolidation loan: The easiest method of getting a debt consolidation loan is to utilize the equity of your home. Equity of your home is calculated and determined by the difference in the amount you have paid and the amount you owe. If the amount you have paid is more than the amount due, you can use it as collateral. This allows you to borrow money on lower interest rates. Besides, you also get tax benefit on this type of loan. Consult your tax advisor before opting for this loan. http://debt-trap.com/category/Debt-Consolidation-Basics.html
6. Do not use a debt consolidation place. (more info on why at the end of this post) All you are doing is moving your debt and it can make you look like you filed bankruptcy. Also if you haven't stopped overspending the average person does a debt con loan and then get deeper into debt. Are you done over spending? If you are then I would, first save $1000 for emergencies. Then cut up all credit cards, work a budget and pay the smallest debt off first, then the next smallest debt. If you really, really want one payment and can get a good interest rate- go to your local credit union and as for an unsecured loan and combine all the debt into one. You will need to close all accounts in order to this, but if your goal is out of debt, then no problem. The following is from Dave Ramsey's website. I suggest you read his book The Total Money Makeover and go to his website to work on budget forms and learn why not to be in debt and how to live within your means. Myth: Debt consolidation saves interest and you have one smaller payment. Truth: Debt consolidation is nothing more than a "con" because you think you've done something about the debt problem. Debt consolidation is dangerous because you treat only the symptom. The debt is still there, as are the habits that caused it. You just moved it! Our counselors will not recommend debt consolidation for a client. The reason that we do not use debt consolidation to get out of debt is because it doesn't work. You end up paying about the same amount, which doesn't really help you pay your debts off faster. Most people end up taking on more debt after consolidation and several end up in bankruptcy.