Mar 30

Credit Card Debt Consolidation Loans: Dig you out of the

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Credit Card Debt Consolidation Loans: Dig you out of the payment grave

If you have money in your pocket, you can spend only as much as you have, but there is no such limit when you are a credit card owner. Most people cannot resist the temptation of buying new cars, clothes, furniture, jewellery, etc., once the credit card is bouncing in their pockets. As a result, credit card debt is head and shoulders above all other debts and is acting as a constant drain on many families and individuals budget.

Once you find yourself caught in the web of credit card debt, effectively the only way out of that hazardous financial crunch to regain your footing is, opting for a Credit Card Debt Consolidation Loan. Because of your negligence, first you bear the pain of paying a high interest for availing credit card services and then you pay a severe rate of interest for repaying the Credit Card Debt Consolidation Loan.

Credit Card Debt Consolidation Loan will help you out in the following ways:

  • It will save you from the humiliation of turning bankrupt.
  • You will not face harassment at the hands of your creditor.
  • Instead of paying too many installments, you will be paying a fixed monthly installment.
  • The rate of interest you will be paying will be comparatively low.
  • Paying creditors on time will improve your credit rating.
  • It will lead you to a road of more healthy personal finances.

    Availing a credit card debt consolidation loan is comparatively easy for homeowners, as they can take advantage of soaring property prices and can offer the same as security to obtain secured credit card debt consolidation loan. They shall have to pay a low rate of interest, because the lender is assured of his borrowers repayment.

    But no such safety net is available to people living in rented accommodations. They have no option but to go for unsecured credit card debt consolidation loans. Such a loan will also carry a high rate of interest. Adding to that, if you have a poor credit history, getting an unsecured credit card debt consolidation loan becomes really difficult, unless the borrower is ready to offer some kind of an asset (say a vehicle) as security.

    No doubt, a credit card debt consolidation loan helps you in reducing your payment amount and sets you back on track, but too much of credit card debt may nullify the effect of this magical pill.

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    Feb 19

    Debt Solutions – Your 12 Ways Out from Debts (Part

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    Debt Solutions – Your 12 Ways Out from Debts (Part 1)

    Being in debt is no fun, especially if you are struggling to make ends meet. Because debt is a complex issue but there may be more than one solution. This article will outlines 12 common methods use by most of debtors to get rid of their debts. Among these 12 debt solutions, there may be one or more options which you can use to solve your financial problem.

    Please note this article will be divided into 5 parts, this part will examine 2 of the 12 methods: Self Repayment Plan & Debt Settlement.

    Self Repayment Plan

    The ideal way to start your debt solution program is with the self repayment plan. Self-discipline is the key factor to ensure the success of this method. Before you come out with your debt repayment plan, you need to understand you current debt condition; detail out all your debts: mortgage & car loan, credit card and other personal loans. Then list down all the fixed expenses such as power, phone, insurance, food and other expandable such as entertainment, gym, membership, dinner at restaurant & etc. Then record down your monthly incomes from salary, part-time job and other source of incomes.

    Tailor your budget plan in line with your debt repayment plan. Budgeting is very important aspect in self repayment plan; you need to make a budget plan which will cut down or eliminate unnecessary expenses, has a saving of portion of your money for emergencies and unexpected expenses while focus most of your money on your debt repayment.

    If possible, you might also consider a part-time job or look for other opportunities to increase your monthly income and these extra incomes can be utilized to fund your repayment plan. If you feel that you might not have a good self-discipline to follow your repayment plan, you might want to consider in set up a direct payroll deposit and automatic payments with your bank.

    While running your repayment plan, you should not take in new debt and follow strictly what you have stated in your repayment plan. With these calculated steps and self-discipline to manage your money and debts, you can overcome your debt problems within a considerable time period.

    Debt Settlement

    Debt Settlementis an aggressive approach to debt reduction, which is appropriate for debtors with a serious amount of debt. This method is commonly use by debtors who have unbearable debts and considering bankruptcy. Creditors will usually settle for less than owed when the debtor is under serious financial strain because if the debtor chooses to file bankruptcy, then the creditor gets nothing. Creditors want to get as much money back as they can.

    You may do it yourself and get help from third party, debt settlement agency to negotiate with your creditors to outcome an agreed settlement amount, sometimes by reducing your debt balance as much as 50%-70%. If you plan to hire a debt settlement agency to negotiate with your creditors, you need to carefully choose a reputable debt settlement agency, understand their fee structure and you are advised to check out if there are any hidden fees involved in the settlement process.

    Debt Settlement is a way to get out of debt in the shortest amount of time, and with the least amount of money without filing for bankruptcy. Although this method of debt relief will hurt your credit rating, it is definitely a better option than bankruptcy.

    In Summary

    Self repayment plan is good if you have manageable debts, a strong intention to get out of debt and a good self-discipline to follow the plan and make a success. Whereas, debt settlement is a fast way to get out of debts with some drawbacks to your credit rating, but it is a better option for debtors who are considering the bankruptcy option.

    See you on part 2 for more debt solutions.

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    Feb 11

    Debt Solutions – Your 12 Ways Out from Debts (Part

    Get out of Debt No Comments »

    Debt Solutions – Your 12 Ways Out from Debts (Part 5)

    Being in debt is no fun, especially if you are struggling to make ends meet. Because debt is a complex issue but there may be more than one solution. This article will outlines 12 common methods use by most of debtors to get rid of their debts. Among these 12 debt solutions, there may be one or more options which you can use to solve your financial problem.

    In the last 4 parts, we have touched on the 9 debt solutions as below:

    1. Self Repayment Plan
    2. Debt Settlement
    3. Debt Consolidation
    4. Debt Consolidation Loan
    5. Credit Counseling
    6. Cash out Refinance
    7. Retirement Benefits
    8. Credit Union
    9. Insurance

    If have miss it, please refer back to the same title with part 1,2,3,4. This is the last part where we will touch on the rest of 3 debt solutions which are:

    • Home Equity loan
    • Credit Card Balance Transfer
    • Bankruptcy

    Home Equity Loan

    Home equity loan is a type of loan where you can borrow money against the value of your equity. The equity in your property can be calculated by deducting the outstanding mortgage on your home from the market value of your home, the remaining balance is the equity, which is what you would have left over in the event that you sold your property at market value and repaid your outstanding mortgage. A home equity loan enables you to unlock that equity and get the money you need without having to actually sell your home.

    In most cases these loans offer attractive rates and low payment schemes. Hence, if you have equity and because of the low interest rate, you actually can pledge your equity to get a home equity loan to payoff your debt. Some lenders will let you borrow up to certain percentage of your equity, such as 80%, but there are lenders who will allow you to borrow up to 100% of your equity value.

    Credit Card Balance Transfer

    If you have a good credit rating, you actually can ask for a lower interest rate from your current credit card issuers. Contact your current credit card issuers and ask for their interest rate if you transfer your other credit card balances over to theirs. You may request for a fixed rate and request them to waive any processing or transfer fees. If you can't negotiate low interest rate with your current credit card issuers, try to get a new card which could offer what you want. Then, transfer all you credit card balances to this new card. You do consolidate this way, be sure to set up an optimal payment plan so that you can be free of debts by paying off all your debt.

    Bankruptcy

    Bankruptcy should only be you very last resort solution when you really can't find other solutions. Although declaring bankruptcy is the faster debt relief to wipe off all your debts from your bill statement, bankruptcy has many undesirable consequences that will follow you for many years; it will remain on your credit report for 7-10 years.

    There are two common types of bankruptcy filling: Chapter 7 and Chapter 13. Most people who file for bankruptcy choose Chapter 7 instead of Chapter 13 because it's fast, effective, easy to file, and doesn't require payments over time.

    Seeing the consequences of bankruptcy, a debtor should always try to avoid filling bankruptcy and source for other debt relief alternatives. But if this is your last ultimate option for debt relief, with a little work, you can improve your credit and recover yourself after bankruptcy.

    In Summary

    Let recap, there are 12 common ways of debt solutions to get out from debts, these debt solutions include:

    1. Self Repayment Plan
    2. Debt Settlement
    3. Debt Consolidation
    4. Debt Consolidation Loan
    5. Credit Counseling
    6. Cash out Refinance
    7. Retirement Benefits
    8. Credit Union
    9. Insurance
    10. Home Equity loan
    11. Credit Card Balance Transfer
    12. Bankruptcy

    Each debt solution has the pros and cons, choose the solution that best meet your financial condition. The bottom line is if you are in debt issues, you should always find a way to get out of it. The worst debt solution like bankruptcy may hurt your credit rating but keep in mind that the credit consequences of not seeking help are far worse.

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