Saturday, May 14, 2011

Consolidating your Debt

By Mondo Humboldt


In these hard economic times there are many who are trying to find their way out from under a pile of debt. Debt consolidation programs offer a way to manage multiple debts by combining them into one payment. If you find yourself facing multiple debts and can't afford the payments the first thing you should do is cut up your credit cards. Try using only prepaid money cards to shop with. Then it is time to chip away at the mountain of debt you already have. Using a debt consolidation program may be one way to help tackle your debt. These programs negotiate lower rates with your creditors and combine all your debts into one monthly payment.

The idea of using a debt consolidation program and be very appealing to those who are under a pile of debt. The truth is these programs charge a monthly fee and possibly some other charges that might cause you to spend a little more to get out of debt. This is why you should consider trying to do what you can on your own. If you have the time and are willing to make the effort, you can negotiate lower interest rates or lower payments with creditors yourself. All you have to do is make your own payment schedule and priorities, like paying off the highest-interest debts first, and then sticking to your plan.

However, being under a pile of debt can be a very stressful and burdensome situation and you may welcome any help you can get, even if it means paying a fee. A debt consolidation program can help relieve some of the overwhelming financial stress and leave you with some extra time, if you feel like that is worth the fee. If you do decide to pay someone to help you out with your debt then make sure you do your research first! There are a lot of consolidation scams so make sure you pick the right plan and stick to it.

Credit counseling or debt management programs are a few of the services offered by professional consolidators. There are also programs that offer consolidation loans through a refinance loan. I f you won a home with equity this may be an option for you. I f you are trying to re-establish your credit and change bad spending habits, try some credit counseling programs. If you are mostly interested in lowering your interest rates, then a debt management plan will probably be best. There are many different programs available to help you manage your debt, so when selecting a program make sure it is the right one for you and what you particular needs are.

Simply enrolling in a debt assistance program won't miraculously solve all your financial problems. It is very important that you identify and then change any bad spending habits. Also, some people may need to get a second job for a while in order to get ahead. When you finally get a handle on your financial situation, no matter what method you use, it is VERY important that you don't land yourself right back into a pile of debt. I have maxed out every credit card you have ever had, then maybe it's time to use only prepaid reloadable cards. This way in the future you can be sure not to spend money you do not have. For more information about prepaid credit cards go to readydebit.com and take the first step toward financial freedom!




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