Digital News Report – There are several options for borrowers who have multiple loans with debt on several credit cards. The poor economy and high unemployment has made debt consolidation more difficult, but there are still options available.
The main goal is to lower your interest and principal payments and to consolidate all of the bills into one low monthly payment. You want to pay less and pay off your debt quicker.
One option is to consolidate your debt into a loan offered by your bank or credit union. Just because one bank turns you down doesn’t mean all of them will turn you down. Check with your bank or credit union first. If you have been doing business with them they may be more likely to offer you a loan.
Another option is to transfer the money into another credit card. Some banks will offer a zero percent interest rate for a limited time and wave transfer fees. You may want to talk to a financial advisor before you transfer student loans.
Debt Management Plans
Borrowers may use a Debt Management Plan (DMP) to lower their payments. A counselor may work with your lenders to negotiate lower payments or lower interest. The biggest company offering this service is the Consumer Credit Counseling Service.
There are benefits and dangers with debt management plans. You may be able to eliminate some of your debt, but your credit score may be negatively affected.
By: Tina Brown