Digital News Report – There are many options available to consolidate personal loans, credit card debt and student loans. The high unemployment rate and recent figures showing low consumer confidence has many borrowers concerned about their own financial situation.
There are several goals in consolidating debt. The first is to lower payments. What good is a consolidation loan if the payments are higher? The second goal is to consolidate multiple payments into one easy installment loan. Writing one check is easier than writing several.
Some banks and credit unions offer debt consolidation loans. The first place to check is your current bank or credit union.
Another option is a balance transfer. Some credit card companies, including Discover and Capital One, will offer special rates if customers transfer debt from other cards. They usually offer a zero percent introductory APR and low interest. Some programs will lock-in a low rate.
The government is giving some borrowers help through their Federal Direct Consolidation Loans program. These loans can help people who are having trouble meeting their school loan payments. In some cases you can defer payment on those student loans.
Debt Management Plans
Various companies offer debt management plans (DMP). These companies work out a budget and can even deal with the lenders. Besides the debt counseling they can negotiates with the creditor and collection agency (CA). One of the biggest names in the business is Consumer Credit Counseling Service.
Consumers can also take hold of their own financial future, work out a budget and call their creditors. If you know you are going to be late on a payment, the government recommends you call the creditor immediately. In some instances, the late payments can be eliminated.
By: Tina Brown