When You Should Think About Debt Consolidation as an Option
Speaking with an experienced credit counselor can give you the hope that you may have been looking for to take care of various personal debts. If you are juggling more than one creditor in paying off a signficant amount of debt, having the process simplified can keep you on track to getting your head above water. You may even feel so overwhelmed that you have considered filing for bankruptcy as a last resort. This is where personal loans can make a difference in preserving your credit score and keeping your financial situation from getting more complicated for years to come. Before you jump at the chance to consolidate your debt with a personal loan, you want to be sure that the lender you choose to work with is accredited by the National Foundation for Credit Counseling (NFCC) or the Financial Counseling Association of America (FCAA).
There is no guarantee that any particular lender will be able to successfully reduce your financial burden, but you should be as selective as possible in working with a lender or credit counseling service that has a solid reputation. It is easy to feel desperate when you are up to your eyeballs in debt, so be sure that you do your homework in researching a debt relief service before signing on the dotted line.
The Pros and Cons of Working with American Debt Consolidation
American Debt Consolidation has helped consumers to get a grip on their debt situation by speaking directly to their creditors on a plan to reduce their debt amounts. This is an intimidating task for many people because dealing with creditors can be stressful and rife with fear of having wages garnished or collections actions filed. The benefit of having a professional debt service speak on your behalf is that your creditors will know that you are serious about taking control of your finances and are considering extreme options. In many cases, creditors will assume that you are close to filing for bankruptcy and would rather be able to collect a reduced amount from you now than wait for everything to move through the courts.
While these results may sound promising, you should keep in mind that they come at a price. That is an important thing to figure out right away so that you do not find yourself paying an exorbitant amount to your debt relief service just to get other creditors off your back right now. Fees can vary, which is why it is vital that you get clear information right out of the gate.
One option you may want to think about is taking out a home equity line of credit to consolidate your debt. This will be a secured loan that uses your house as the collateral. The danger of using this type of loan is that you could end up losing your home if you cannot make the required payments. A reputable debt relief service will discuss this option with you as well as the other potential ways that you can reduce the burden of your personal debt.