Debt Consolidation a SCAM?
College loan consolidation relieves the students from the tension of repayment of their loans by consolidating them into a single installment and that too at a lower rate of interest. So, it also helps them to concentrate on their studies.
Why college loan consolidation?
Today’s career conscious students can actually get great help to ease off their burdens of repayment of large amount of their student loans. They can conveniently pay attention on their selected career instead of wasting their sleep over paying the various installments of monthly student loans. College loan consolidation ensures them a peace of mind even when they are in huge debt.
When a student applies for different loans from various financial institutions, there are numerous interest rates and long term payment system that comes along with such student loans. The main aim behind a consolidation student’s loan is to combine the various student loans into a single convenient payment loan system. With these student loan consolidation schemes, the students only need to make a single monthly loan payment instead of the burden of several loan fees for each month. Having the features of less credit checks and lower rates of interest make these consolidation student loans all the more demanding and advantageous.
Relieving the unnecessary tension
College loan consolidation contributes in helping students to focus more on their education and development rather than the debt that needs to be repaid. With a single loan and lower cost of monthly payments, students can enjoy their tension free sleeps. After making a thorough research on the available options in student’s loan consolidation, one can find the best and most beneficial consolidation students loan service provider.
Some of the exceptional benefits that are provided while you choose to consolidate student’s loan include:·
* Payment of the fixed rate of interest- With some of the federal student’s consolidation loans, there may be chances that you would be required to pay a fixed rate for the entire life of the student loan. It is a wise idea to do some research and see the most appropriate rate of interest and the total loan term that you are eligible for.
* Lower amount of monthly payments- Depending upon the amount of the student’s loan and the willingness of the lender, students may be able to get the monthly payments lowered up to fifty percent or so.
* Extending the total payment time span- With the help of federal consolidation student’s loans, you can avail the facility of extending the repayment period up to a maximum of 30 years or so.
* Having easy and convenient loan payments- By taking the option of consolidating student’s loan, the students need to have only a single loan payment for each month and writing a single check. This is highly advantageous in case you are writing various checks each month to several lenders as it can be really confusing as to what amount needs to be paid to which lender?
Availing the online options
Internet has made it easy to approach the lenders who help in a quick student loan consolidation. The World Wide Web contributes tremendously in making convenient the research and finding excellent deals for consolidate student loans with a few mouse clicks. You can get latest quotes and compare different interest rates and quotes of several loan providers and that too without wasting your efforts as you need not waste any money and time in visiting each and every consolidation loan service provider.
Watch the video related to Loans Consolidation
Most debt consolidation companies do nothing better than simply ruin your fico score in order to settle your debt. If you really want to work with an agency that will help you reduce your debt, contact a company member of “CONSUMER CREDIT COUNSELING SERVICES” (CCCS) More info at: sccrealestateuncensored.com/2008/repair-credit-legally-remove-negative-accounts/ micasamidinero.com/2008/reparo-credito-eliminando-legalmente-cuentas-negativas/
Help answer the question about Loans Consolidation
Is there any banks left that do consolidation loans?I am looking for a bank to do a consolidation loan. Currently make good money and would rather pay one person. If anyone knows any or person that will do $25,000 for $1200 a month please let me know. Also they must be able to accept Allotments.
About Author
Daisy Wilson is an expert in college loan consolidation and her articles has helped many students to sort out their debt consolidation woes. She has deep insight in debt consolidation and other related issues.
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You can pretty much do it yourself.
Debt consolidation can be a great way to start tackling your debt – whether it’s just lowering your rates, getting a better loan, or cutting your payments to get debt free faster. Debt consolidation loans consolidates multiple lines into one new loan or debt consolidation program – it typically involves a debt consolidation loan, but could also be referred to as a credit counseling program or other forms of debt resolution that do not involve a new loan. It is important that you know what your options are and what your goals are before choosing a debt consolidation program or company.
Debt consolidation is a solution to stopping your debt from spiraling out of control. Debt consolidation doesn’t reduce your debt; it merely eliminates multiple high interest rates associated with debt from various lenders. A debt consolidation loan is one viable solution to consolidating your debt. In this situation, you basically get a loan to pay off all your various debt or get a better type of loan (changing from an ARM to a Fixed rate loan).
It is better to seek help from any reputed debt relief company to choose the right option matching your financial health. I took help of Bills.Com to consolidate my debts. I have joined their debt relief program one year back and now I am almost debt free.
Lenders usually only give debt consolidation loans to people with good credit….Even if you qualify, doing debt consolidation can be a dangerous path to go down…It takes extreme discipline to do this…..After their credit cards are paid off from the consolidation loan, to many it's simply too tempting to use all that available credit again on their credit cards…and you can quickly find yourself in twice as much debt as before.
Another option: Contact your local Red Cross for a referral to the local Consumer Credit Counseling Services (CCCS) in your area. They can negotiate much lower payments and interest rates. They DO NOT negotiate settlements.
They will require you to stop using all credit and to cut up your cards. Your credit report will be updated to "enrolled in debt management." This does not damage your credit, but it may make it impossible to obtain new credit while you are enrolled in their program….so don't use this service if you anticipate applying for a new apartment, car loan or mortgage anytime soon, as you would probably be denied while you're enrolled in the CCCS debt management program…. Otherwise, it can be a very good way to deal with your debt.
Debt consolidation makes sense if you're in debt because of a temporary situation, such as a period of unemployment that's ended or a medical condition which is now resolved. Be sure that your new interest rate is lower than the old one, otherwise it''ll cost you more than what you're paying now. Be sure, too, that it's not secured by your home. A credit card company can't take your property if you don;t pay, but if you have a secured loan they can.
Above all, be sure you can get by without using credit cards if you're going to consolidate your debt. Too many people use a consolidation loan to pay off their maxed-out cards, then they continue using the cards, and pretty soon they have twice as much debt as they did before.
Not only debt consolidation, but a host of other scams – from easy money online, or work at home jobs, or schemes like Project Payday, CashCrate, etc.
They are there to make money for those who push them, and not the naive hopefuls who sign up with stars in their eyes.
It is quite discouraging to see the number of posters in this forum asking about easy ways to make money online with no experience and no skills. These folks are the targets of the scams, and they keep coming, and coming, to their destruction…..sad.
Like most other businesses, there are good points and bad points to consider. BUT, why pay someone more money (which = more debt) to do what you can do a lot cheaper and keep your head above water.
Debt counseling and management is by far a better way to go. To find out more about these programs and how to get out of debt I have provided a link to the Fair Trade Commission web site to explain what you can do.
http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre19.shtm
Read this information first before making any hasty decisions.
Hope this helps answer your question
Stay away from any "debt consolidation" company that promises to cut your debt in half through debt settlement….This is a risky tactic of deliberately ceasing all payments to creditors and forcing your accounts into default to attempt settlements. You pay a monthly fee to a debt consolidator….this entire fee goes towards building a settlement account and to the consolidator's fees to “settle” your accounts in the future. Your credit card companies will deliberately not be paid so that all the accounts will default/charge-off so that they can attempt settlements at around 50%. If you are current on your accounts, this process will ruin your credit rating for sure. Debt settlement is like a roll off the dice with your finances…You can never predict how your creditors will respond to the deliberate defaulting of your accounts…they might settle at 50%…or they might serve you a summons, take you to court…and if they win, you could be looking at wage garnishment.
None of these “debt consolidation” firms have the power to force your creditors to accept settlements. Your creditors have the right to refuse these terms and take you to court.
http://online.wsj.com/article/SB122394458494631223.html
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If all this debt is seriously delinquent and you have money to offer settlements yourself, then you don't need to hire a debt consolidation firm…you can settle directly on your own…The problem here is that they'd probably want a lump sum rather than small payments over several years.
If you don't have any money to settle, then you may want to think about filing for Chapter 7 bankruptcy.
No, it is not always a scam. Debt consolidation and debt elimination are two different animals and should be looked at separately.
Basically, debt consolidation helps you in accumulating your multiple debts into one single debt, lowering your payable amount. The debt consolidation companies do this by negotiating with your creditors.
1. Waives off the interest rate:
Debt consolidation helps you to eliminate or reduce the interest rate. The debt consolidation companies bargain with all your creditors to reduce the interest amount of your debt. This way they help you to lessen your debt amount.
2. Single monthly payment:
If you have multiple debt payments, like credit card bills, utility bills and medical bills and is missing your regular monthly payments, debt consolidation is the best option for you. It saves you from becoming a defaulter. The debt consolidation program allows you to merge all your debts into a single debt and make a single monthly payment for all the debts you owe. The debt consolidation company will deal with all the creditors on your behalf. This would make your handling of debts much simpler.
3. Get rid of creditor calls:
The debt consolidation company not only consolidates your debt payments but also helps you to avoid creditor calls. Whenever you sign up with a debt consolidation company, they assure you to communicate with all your creditors on your behalf. As a result, the creditors stop calling you.
4. Sound credit score:
If you consolidate your debts, you can reduce your outstanding debts in a set out plan. Within a short span the consolidation company helps you to repair your bad credit and get out of all your debts. This way, by reducing your debt burden you can also raise your credit score to some extent.
Debt consolidation is an effective way to get debt relief. Online debt consolidation has become very common these days.
You say your have about a decades worth of bills totaling $10,000?
The debt consolidation companies would love to help you, they'd make a killing off of you. Do not go to a debt consolidation place, well unless of course you'd love to get ripped off.
Now, lets talk about what you should do.
When is the last time you paid on these bills? Pull your credit report to see what's actually listed on there Visit the site http://www.annualcreditreport.com. Don't bother signing up for the various ones that give you a free month trial. You'll forget to cancel and they'll start charging you. Also, you most likely don't need to purchase your credit score at this point either.
Pull all 3 reports and review them. Now there's two routes to take.
The first is if you want to pay everything off in full. If you do, just start sending the money for the full balances to the creditors listed. You should start paying off the ones that had recent negative activity or recently went to collections. Why? Because if this process takes you 2 years to pay everything off then other items that are older may fall off your report in those two years. After 7 years from the first negative reporting an item will generally fall off your credit report. This does not mean you don't still owe it, it just means they cannot report it anymore(Again, generally speaking, they go away, you still technically them still but depending on your state they usually can't sue, see http://www.fair-debt-collection.com/SOL-by-State.html for your state's statute of limitations)
The second route is a little different. Generally speaking, creditors will settle for less than you owe. This will be reported on your credit report as paid, but settled for less than the balance. Go through one by one and negotiate with your individual creditors to see what type of settlement they will make. Never agree to pay more than you can and work your way backwards the same way.
Now for the tips, Find out what your state's statute of limitations is. Making a payment to a creditor will essentially reset the timer. So if your statue of limitations is 4 years and you pay on a debt that's 3 years and 6 months old, you've reset the timer. The Statute of Limitations is the time frame a creditor has to sue you in. You don't want to set out on the right track and end up with lawsuit papers.