debt consolidation loans

Debt Consolidation Loans for Bad Credit

July 5, 2014 by arizona

Because your credit is part of your financial record from the time you become an adult, you may have inadvertently damaged it in your younger days. If you have bad credit, you might wonder if it’s possible for you to get your debts consolidated. Here is a little information on bad credit and debt consolidation.

What are some signs that you may need to look for debt consolidation loans for bad credit?

When you are struggling each month to make your payments or make them in a timely fashion you may have realized that you need assistance. Let’s look at a few other signs that it may be time to look into getting debt consolidation loans for bad credit.

Bill collectors call frequently.
You’re only making partial payments.
You’re using one credit card to pay another.
You miss payments or are late.

Can I get debt consolidation loans for bad credit?

There are still a few options for you to explore as far as debt consolidation with bad credit. One of these is the payday advance. On the plus side, these are usually easy to get and not secured by anything except the agreement to pay and sometimes a post dated check.

Another type of debt consolidation loan for bad credit is a simple personal one. With this type of loan, you would go directly through the lender, so it does cut out the middle man. Remember that even loans specifically for debt consolidation often give better interest rates to people with better credit though, so always go into it expecting that.

These loans do have the added bonus of being very easy to handle. Many times you can actually go through the whole process online, and have the money deposited directly into your bank account.

Some ways to get a debt consolidation loan for bad credit

Your first step should be to examine your personal situation closely and see what adjustments can be made to your budget to make things run more smoothly in your life. Sometimes the trouble started because of accident, injury or some other unforeseen circumstance, but this isn’t always the case. So, just clean it up where you are able.

Next, you should sit down and make a list of your monthly income and your expenses in order to figure out how much you need to borrow to consolidate all of your debts into one payment. After this, research some actual lending institutions and get some information on requirements and interest rates available. Do keep in mind that you may have to get a co-signer if things are really bad with your credit or payment/job history.

You should also understand ahead of time, that if you are refused a loan even with a co-signer, your only choice may be to pursue a bankruptcy. This seems unpleasant, but it might come down to necessity at that point.

What else is there to know about debt consolidation loans for bad credit?

While it can be difficult to get loans with bad credit or even slightly imperfect credit, they can be very useful when it comes to consolidate your debts into one easy monthly payment. This makes it easier for you to get caught up with everything and eventually even improve your credit.

There are a growing number of companies that specialize in the service of debt consolidation. Wading through all of the information that they put out can be daunting but, let’s look at how to make the decision a little bit easier.

When you decide that you are ready to take the steps to debt consolidation, you first should sit down and go through your financial information. If you are too overwhelmed by doing this on your own, remember that there are counselors that specialize in this type of service and you can always reach out to them. That’s what they are there for. This is very important because you need to know what you owe and what your payments will be like. There are scams out there, so you want to have all of the information on your own finances at your fingertips and easy for you to understand.

After this you can easily contact a lending institution and feel more comfortable with discussing this type of loan with them. Remember to pay careful attention to the loan repayment, so that you don’t get in a worse situation.

With all of this information available, you should be able to make an informed decision and feel much more comfortable about the direction that your finances are heading. Even though it can seem like a huge thing to undertake, once you start getting everything organized in your budget and paying your debts off in an easier fashion, you will be well on your way to improving your credit and your outlook on life.

What You Need to Know about Debt Consolidation in Arizona

August 12, 2013 by arizona

If you are having problems with your finances then the one thing you cannot do is to ignore the problem hoping it will sort itself out. It does not matter if you have been involved in an emergency that has used up all of your savings, lost your job or been irresponsible with credit card purchases. Once you are in difficulty then it is important to sort out of the problem before your credit is damaged, lose your assets or end up in bankruptcy.

Here are some ways that you can sort out your finances and get back to a position that you are no longer struggling to pay your bills.

Document your financial position so that you can identify where your income is being spent, how much debt you have.
Reduce your expenses as much as possible by cutting non essentials that will allow you to put more of your income to paying your debts down as quickly as possible.
Increase your income. This can be difficult but you can approach your employer for extra hours or try to get a part time job on the weekends so that you can pay down your debt to a more comfortable level.
Finance high interest debts like credit card debt with a consolidation loan so that you have a single lower repayment.
Contact one of the organizations and companies that specialize in debt consolidation in Arizona.

Debt Consolidation Loans in Arizona

A loan can be a great way to pay off credit cards that have high interest rates. This is known as a debt consolidation loan and has become very popular because it is relatively easy to obtain a loan at a favorable interest rate if your credit history is reasonable. There are different loans available and these include low or no interest balance transfers, unsecured debt consolidation loans and secured debt consolidation loans.

Here is some information about low and no interest balance transfers.

A great way to reduce your monthly payments is to take advantage of any balance transfer offers. This allows you to transfer your current credit card balance to a credit card at a low or no interest.
Offers lower repayments.
Is usually very quick and can be completed within a week from applying.
Consolidates all of your high interest debt into a single monthly payment.
You can tailor the repayment time for a lower monthly payment over a longer time or a higher repayment over a shorter time.
Many institutions from banks, credit unions and specialist lenders have unsecured loans available at favorable rates.

Advantages of an Unsecured Loans for Debt Consolidation in Arizona

Secured loans for debt consolidation in Arizona usually have the best rates but care must be taken because you will lose your security if you default on the loan.

This type of loan usually has the lowest interest rate available.
Is more likely to be approved even with a poor credit score or credit history.
Can be used if you need to consolidate loans that are too large for unsecured loans.

All of these loans can be a very good way to consolidate your debt and make it easier to repay. The problem with all of them is if you do not change the behavior that caused you to get into problems in the first place then you can end up in the same position with even more debt.

Debt Management Programs in Arizona

One of the more popular ways that people are using when they need debt consolidation in Arizona is to use a debt consolidation company or a credit counseling agency. These organizations specialize in helping people with debt problems. Let’s look at some of the ways that they can help people to stabilize their finances.

They comprehensively look at your finances so that they can understand your income, expense and debt situation.
Produce a budget that is used as part of debt payment plan so that you can afford to repay the debts that you have and still pay your bills and living expenses.
Negotiate with your creditors to adjust payments and interest rates so that you can repay the debts in a timely fashion.
Educate you on how to keep yourself from getting into further debt trouble.
Provide a single payment system where you pay them and they distribute the funds to the creditors making it simper to make your payments.
Provide information on how to budget so you can better handle your finances.

Debt consolidation in Arizona is a way to save your financial situation before you get so deeply in debt that you are forced into bankruptcy. It is a simple process that only takes a few visits and the commitment to stick to a budget and not accumulate more debt.

Debt Consolidation Loan Checklist To Avoid The Pitfalls

June 20, 2013 by arizona

If you want to use debt consolidation loan as a way out of your debt situation, you have to make sure you qualify for it. While it is very tempting to run away from your debts, you need to face the music and own up to the financial mess that you created. This debt relief option is effective but to know if it is the right solution for your problems, here are a couple of things that you may want to look into.

First of all, you have to qualify for a loan that is big enough to cover all, if not most of your debts. The idea is to use the new loan to payoff your other debts so you can enjoy a single payment every month. If you know that you will only qualify for a loan that is enough to pay only 2 or three of your 7 debts, then you may want to consider another solution for your debts.

The second item in your checklist is the interest rate. You want to aim for a lower interest rate than your current because you are after a lower monthly payment. If it ends up to be bigger like payday loans, or something similar, you could end up making your debts worse.

As mentioned, it should decrease your monthly contribution. This happens because you have stretched your payments over a much longer term. If this is not achieved by the loan that you are applying to, then you should opt for a different debt relief program.

The fourth in the checklist is your ability to pay the monthly dues in the next 3 to 5 years. In this debt relief option, your debts are not reduced. It is only restructured so it is easier to pay off. Because of that, you need to secure your payments by creating back up plans. This is more difficult to guarantee which is why you are highly encouraged to set up supplemental income sources. With the ease brought about by the single payments, you should be able to concentrate on growing your income by either taking in more work or setting up a personal business.

These four items in your checklist must be met to ensure that you solve your debt problems. If you want to use this option, be very careful about racking up more debt. Once you have paid off what you owe your credit cards, for instance, you might be tempted to use them again. Never forget that debt consolidation loan is only about restructuring your debts, not paying it off completely. You still have to do that so make sure you do not add to what you owe.

Another part of what you should do is to accept that something has to change in your life. Most of the time, debt is a result of overspending. You had been spending more than what you earn. You need to change this and start living within your means.

What Is The Difference Between Debt Consolidation Loans And Debt Settlement?

May 13, 2013 by arizona

Over the course of making it through life, we have decision points that either makes or breaks us. It could be about educational decisions, career and the like. They each have their own take on how well we live our life but none is as unique as the financial decisions we make. These has the lingering effects that we feel well into the twilight of our lives. And getting on the wrong end of those financial decisions could mean debt.

Debt can come in many forms just as getting rid of it has many options to choose from. The two most common alternatives are debt settlement and debt consolidation and choosing one from the other has different sets of pros and cons. It all depends on your current financial status and need.

Debt consolidation loans require getting financial aid so that you can pay off all your other debts. The whole idea is to combine your debts by paying them all off and maintaining the one loan that you used to pay. The end result will be a single and more manageable payment instead of multiple accounts. Another target is a lower monthly payment. There are personal loans that last for 5 years, this allowing you to distribute your balance over a longer payment period. It will result in a lower monthly payment. That lowered payment is also a result of low interest rates. Getting a low interest loan is important to make this happen. That can be accomplished if you have a good credit score or you have a collateral. But if not, then you may have to consider your other options.

Getting a loan to combine your debts also require you to have a steady income. You are not reducing your debt balance. Despite the lower monthly contribution, you will still end up paying for everything that you owe. If you cannot afford that, then your obvious option is debt settlement.

As a debt relief option, debt settlement is a great option because it aim for the reduction of your balance. This is done through debt negotiation. You can do it on your own or you can hire a professional to help you out. The whole process begins by defaulting on your payments deliberately. You want to convince your creditor that you are in a financial crisis and not paying your debts is one of the effective ways to do that. Instead of sending payments, you will put that amount aside for your settlement fund. You will then concentrate your efforts on convincing your creditor that you cannot meet payments anymore. You will haggle to pay pennies for every dollar that you owe. When you reach an agreement, you will pay only a percentage of your debt and have the rest of it forgiven.

As appealing as the whole reduction may sound, you have to remember that defaulting on payments will decrease your credit score significantly. If you do not feel comfortable with this and you have a steady income anyway, you can always opt for debt consolidation loans instead.

What’s Next After Your Debt Consolidation Loan Is Approved

April 29, 2013 by arizona

Debt consolidation loans may be an effective debt solution but you need to realize that it has a high fall out rate. That does not mean to say the whole concept is flawed. There have been success stories but unfortunately, these do not make up the majority.

If you think about it, the reason why debt consolidation loans seem to be unable to help with debt is because of how consumers treat it as a debt relief option. Sometimes people are so focused on paying off their debts and once they get the loan approval that will pay it off, they start to relax. They are under the impression that the debt problem is over because the confusing multiple bills are now gone and replaced by one big loan. Also, if the debts paid off are mostly credit cards, it will be very tempting to use them again because they are all on zero balance once more.

These are only a few of the reason why financial experts dislike debt consolidation loans. You need to realize that it all boils down to how you react to the loan approval. Everything that leads from there will either be a success of failure depending on how you act.

So how should you act once your debt consolidation loan is approved?

First of all, you want to pay off your debts immediately. Don’t make excuses to pay only a portion of the debt and then spend it on something else. Put everything into your debt payments as planned.

Once you have paid off all your dues you have to do something about your credit cards. You can either close them off except for one, or you can keep them in a place where you will not be able to easily access them.

Another task that you have to accomplish after you got your loan approval is to map out how you will pay off this new debt. No matter how good it feels to completely pay off your credit card debts, you need to keep in mind that you haven’t solved it yet. You merely shifted your debts around but you still have to pay them off.

Create a debt payment plan and make sure that you will stick to it. You can also create a budget plan or revise it if you already have one. Make sure both your debt payment plan is budget coincides with each other. Put in your budget the amount indicated in the other plan so you don’t make a mistake of forgetting any payment. This is very important for your credit score too. As you pay off this loan diligently, you can expect that your core will rise steadily.

Lastly, you should put aside an amount every month so you can grow your reserve fund. Saving should be combined with your debt payment efforts because it is one of the most effective ways of keeping you from another debt situation.

Opting for debt consolidation loans will bring you towards financial freedom but you need to be very cautious about how you will manage it once you get the loan approved. In the end, it’s still about how you make smart financial decisions.

Why You Need A Debt Payment Plan In Debt Consolidation

April 16, 2013 by arizona

Debt consolidation, especially the one involving loans should be done with a debt payment plan. This is important because unlike debt management, you are working on your credits alone. There is no credit counselor helping you manage your monthly payments. In fact, even with the presence of an expert, they still create a debt management plan – which is similar to the debt payment plan.

Implementing your own debt relief program is tough because getting yourself in debt means you are not the best person to handle finances. You have a lot to learn and doing it alone may be tougher than you think. But what you lack in expertise can be compensated by adequate preparation. This preparation literally means creating a plan that will help you monitor your monthly contributions. The best way to do this is through a debt payment plan.

Before you apply for a loan, you need to know the problem that you will solve and your financial capabilities. You need to map out a payment plan that will allow you to pay off this new credit account. You have to identify the accounts that will be paid by the money you will borrow and how you will ensure that they will no longer incur any more debt.

The debt payment plan is comprised of two smaller plans: budget and payment schedule.

Creating a budget is simple enough. It just involves detailing your income and your expenses. The key to input the smallest amount of your income for the last 6 months and to provide the complete and detailed list of where you spend it on. These are important because you want to make sure that you will never fall short. When you have both, you need to get the difference so you know how much is left of your income after the expenses had been paid off. This is called the disposable income.

The disposable income will play a big role in your payment schedule. This will detail how much will be put into your loan, or other debts that were not covered in your debt consolidation loan. You will indicate when and how much should be sent to your lender. This is to ensure that you will never miss out on a payment.

Being organized about your debt relief program is very important if you want to keep yourself from failing. There is no one else who will accomplish this but you. It is better to be as detailed as you can – especially when you are listing your expenses.

Once you have completed your debt payment plan, make a commitment to follow it. Regardless of how perfect your plan may be, it will be useless if you fail to stick to it.

On a last note, make sure that you allocate funds for your savings. One of the best ways to stay out of debt is to have an emergency fund that you can use when your income is suddenly compromised. Being prepared is more vital than ever – at least that is what the recent recession should have taught you.

Consolidate Credit Card Debt Instead Of Sticking To Minimum Payments

April 11, 2013 by arizona

If you are wondering how you can get out of your credit card debt, there is one thing that is for certain: stop sticking to the minimum payments. This payment requirement is one of the traps that will get you in debt for a very long time. Getting out of debt will require a lot more than just scraping the surface of your debts – which is what you are accomplishing with the minimum payments.

The thing about credit card debt is that the high interest rate and the finance charges will keep your debt balance high. You need to make significant contributions because you will be old and gray before you complete your card payments.

Here’s an example of what you are up against. If you have a credit card debt worth $10,000 with an interest of 20%, your minimum payment will have to be around $400 every month. If you stick to that, it will take you more than 14 years or 172 months to completely pay off what you owe. Throughout that period, you will be paying off $6,989 worth of interest. Would you really want to waste that amount of money on your creditors? If not, then you need to look for another alternative to pay off your debts.

If you are thinking about your limited income and the fact that you can only afford the minimum payment, then you should not give up hope yet. There is a debt relief option that targets to lower your payments without necessarily spending forever to pay off your debt. You may be hesitant to lower your monthly payment because the minimum in itself will take you more than a decade to complete payments, what more if you pay below that?

Here’s how it works. The debt relief option is known as debt consolidation loans. You apply for a loan that is big enough to pay all your credit card debts. Personal loans, especially secured loans have a low interest rate. They are oftentimes much lower than credit cards that average at 18%.

If you search for a personal loan calculator online and calculate the same $10,000 debt and an estimate of 10% interest rate, the software will indicate that you only pay $212 a month. If you stretch it over 60 months or 5 years, you only pay off more than $2,700 worth of interest. Of course, all of these are just estimates and every lending institution will have varying rates. However, you can see how it is a better deal compared to paying off through the minimum technique alone. If you can afford a higher contribution every month, you can cut down the interest rate, payment term and the interest amount that you will end up paying for.

The key is to get a loan that has a low interest rate. This can be done by having a good credit score. If you haven’t missed any payments yet, you may even get an interest that is as low as 6.5%. Another way to score that low interest rate is by putting up a collateral that will make you qualified for a secured loan. If you can stick to the payments, you will not be endangering your asset from being taken by the lender.

Debt Consolidation Loan Pitfalls To Avoid

March 21, 2013 by arizona

Debt consolidation loans, while an effective debt relief program, is still riddled with a lot of pitfalls. You need to be aware of these risks so you can avoid them and establish a more successful program for yourself.

But before we discuss pitfalls, let us talk about what is involved in debt consolidation loans. The whole idea is to get a loan that is big enough to cover all your other debts. When you are approved of the loan, you will pay off the other debts and will concentrate on this one loan.

This debt relief program does not involve a professional to help with your efforts. No one will help you create a payment plan but yourself. You will be in charge of sending payments and making sure that it is kept updated. All of these responsibilities will fall on you. That means you have to be vigilant so you never slip up and suffer any late payment fees. This is one of the pitfalls that you have to avoid. You need to keep your commitments and one way to do that is to create a payment plan. This also includes a budget plan. Both will help you view a general picture of your income, expenses and loan payments. You will be able to keep tabs on when a payment should be made and how much should be allotted every month.

Another pitfall that you have to be aware of is the fact that all your credit cards will not be back to zero. Since you have paid them off, the temptation to use your cards could even triple. If you are not aware of this danger and you succumb to the temptation, you will end up growing your debt further. Instead of paying it off completely, you will make matters worse. You need to do something about your cards to make sure you will not fall into this pit. If that means you have to lock up your cards, then that is what you should do. Make sure it will be difficult for your to get it so you will think twice about using it.

In connection with that, another pitfall that you can get into is the false assumption that your debts are not as bad as you thought. Paying off your other debts with the new loan you got will give you a feeling of debt freedom. The ease that the single loan payment provide can also allude you into thinking that you have solved your credit problems already. That is not true. You just shifted your debts around but the balance is still the same. You still have the same amount and although your monthly payments may be lower, the same obligation to pay it off is still there.

Bottom line is this: when you choose debt consolidation loans, you have to understand that the responsibility is not diminished. All it really takes is your attitude and your commitment to the debt relief program to make sure that you can avoid the pitfalls we discussed here. Practice proper financial management in paying off this new and substantial loan and make sure you develop the right habits that will keep you out of any more credit problems.

Solving Credit Card Problems Through Debt Consolidation

March 7, 2013 by arizona

Solving Credit Card Problems Through Debt Consolidation

Credit cards debt can be very hard to get out of. The high interest rate and various fees makes your balance grow very fast. If you are not careful, you may end up with more debt than you can handle. As soon as you realize that your credit balance is getting out of hand, you need to act fast.

One of the most effective ways to get out of your credit card debt is through debt consolidation. Among the other choices, this is the program that will not have too much negative effect on your credit score. In the beginning, your score may dip lower but that will soon increase when you start paying off your debts based on the payment plan of the program.

The whole idea of debt consolidation is to combine your debts into one easy payment. So if you have more than one credit card debt and all or most of them are maxed out, then this is the right debt relief option for you. The consolidation of your credit accounts can be done in two ways.

The first is known as debt consolidation loans. This method begins with a loan application. The amount that you will loan should be big enough to cover the total amount of your credit card debts. Make sure that you check the interest rate of your new loan. It is ideal that it should be lower than your current APR. If it not then you may want to rethink your options. Once your loan is approved, you can pay off your credit card debts so they all return to zero balance. After that, you can concentrate on paying off the loan – which usually takes 5 years to complete. That depends on the details of the loan that you got. Most of the time, the monthly payments become lower because the combined debt amount is stretched over a longer payment period and the interest rate is also lower. At least, when you are shopping for a loan to apply for, this is what you should aim for.

The other option is debt management. This actually begins as credit or debt counseling. You get in touch with a third party company who will assign a credit counselor to you. This counselor will help analyze your finances to understand just how much you can afford to pay for your debts. It will be compared to the minimum payment requirement of your credit card debts. If your debt payment fund is not enough to cover the minimum, the counselor will put you in a debt management program that will allow them to negotiate with the creditor on your behalf. They will request for a longer payment term so that your current balance will be stretched over a longer period. That will result in lower monthly payments that your finances can afford. You will then follow a debt management plan or DMP that the counselor will monitor. You will send you payments to the credit counselor and he or she will be in charge of distributing payment to your various creditors.

Regardless of what you will choose between the two options, you will need a steady income to be able to support your payments. Remember that there will be no reduction on your credit balance. You should also make sure that you curb your credit card spending. Knowing how hard it is to get out of this debt, you need to make sure that you will avoid that pitfall in the future.