Conslidating debt

A debt consolidation loan can take a lot of the stress out of your financial life by reducing multiple monthly payments to just one payment to a single source.However, the whole purpose of doing this is to reduce the interest rate you pay on debts as well as the amount you pay every month so it is important that have accurate financial records.

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It comes in several varieties, each one having plusses that make it appealing and minuses that might make your situation even worse.

Because every person’s financial situation is unique, it is best to spend time examining each option and find the one that is right for you.

But unlike a loan, credit counselors work with your creditors to lower interest rates.

That translates into a lower monthly payment for you.

But you can also add past due utilities, collection accounts, payday loans and medical debt for “payment convenience.” In other words, there isn’t a reduction in interest rates, but it can simplify and consolidate your bills.

One thing to consider is that medical debt and utility bills don’t have interest rates attached to them.Certified credit counselors can recommend your next course of action. Enter the proposed interest rate and repayment period under under Consolidated Loan Information. The calculator will show you how much you can save with a debt consolidation loan.Debt management plans primarily consolidate credit card debt, which happens to be the most common reason to consolidate debt.Secured debts such as homes, property and automobiles can be refinanced, but are not considered good candidates for debt consolidation.Debt consolidation is beneficial to some people, but not everyone.These plans are offered by nonprofit credit counseling agencies, like In Charge Debt Solutions, and do not use credit scores for eligibility.

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