subject: Debt Consolidation Pros And Cons – Your Options To Come Out Of Debt Soon [print this page] Debt Consolidation Pros And Cons Your Options To Come Out Of Debt Soon
Debt consolidation can serve as a light at the end of the tunnel for men and women that find themselves way over their heads in debt.
Before making a decision as to whether or not consolidation is the best option for your personal situation, you would be wise to consider both the pros and cons of eliminating your debt through streamlining it into a single monthly payment.
Aurora Lillo Editor of the "Best Debt Consolidation Services" website -- http://www.BestDebtConsolidationServices.net -- pointed out;
"...In the end, no matter what the pros and cons of consolidation are, action is always better than inaction and moving forward toward financial freedom by any means possible should be your direct response to a bad credit situation..."
Pros
When you consolidate all of your debts into one monthly payment, you are basically opening up a new line of credit to pay off all of your lesser debts. This new debt is then repaid via a monthly payment plan that you yourself create with the help of the financial institution providing you with your new line of credit. As such, you will no longer need to worry about juggling several different payments every single month. Gone will be the worries of late payments and you will feel the release of all the pent up financial stress that making several minimum payments every month can produce. In addition, since your payment plan is designed to fit perfectly into your current budget, you should be more than able to make your monthly payments on time every month, resulting in positive credit activity. In a very short period, this positive activity can lift your poor credit rating out of the mire and set it high up on healthy shores.
Cons
"...Since debt consolidation involves closing all of your credit accounts, you can expect an initial jar to your credit score. Basically your credit reporting agency will recognize that you have less active lines of open credit than you did before and will lower your score accordingly. In addition, since consolidation loans are often (but not always) requested from individuals that find themselves in negative credit situations, the monthly interest rates may be higher than you would expect from a standard loan or credit card. Consolidation companies also typically charge an initial fee to enter the program and a monthly service fee. While these fees can be negotiated, they are an added expense that needs to be considered before you enroll in any given debt consolidation program..." added A. Lillo.
Further information about trusted and reputable companies for debt consolidation by visiting; http://www.BestDebtConsolidationServices.net
