subject: Towards A Debt Free Future With Effective Debt Consolidation Services [print this page] Debt consolidation servicesare becoming increasingly popular in recent years as the after-effects of the economic slump start to show. Many are opting for debt consolidation services to aid their efforts in eliminating all their accumulated debt. Although this method may not actually reduce your debt, it provides you better manageability of your debt and allows you to get rid of the need of paying excessive interest rates to multiple lenders. Thus you are actually reducing the amount that you pay to your lenders in the long run. If you realize that you are drowning in the midst of several debt accounts with no apparent solution to clear your accumulating debt, debt consolidation could be the answer for you. However, it would be good to keep in mind that consolidating all your debt accounts under a single account would probably lower your credit score. This is due to the fact that you would be closing numerous credit accounts at once. Nevertheless debt consolidation could assist you in your mission to emerge debt free in the near future. Thus the credit hit is something that you would probably need to endure for at the present time in view of a better future.
When you consider debt consolidation as a solution to your debt issues, you would first have to accomplish debt negotiation with your lenders, to work out a solution before seeking the assistance of other leUnlocker.exenown as debt settlement, this is the process of negotiating with your current lenders to establish a new payment scheme with a lower interest rate to help you cope with the monthly payments better. Alternatively, you could effectively lower your loan amount to your lender by paying a lump sum amount and reducing the total balance significantly. Rather than losing you as a client to another competitor, generally lenders would be open to negotiations and willing to discuss terms with you that would potentially benefit both parties.
Wondering how to negotiate your debt successfully? You could either accomplish this yourself through the use of a debt negotiation letter, or you could hire a debt settlement company to negotiate on your behalf. If you are planning to negotiate on your own, you could arrange for a meeting with your lenders, and be calm and convincing when you present your case to them. It is advisable that you negotiate professionally and unemotionally, as your lenders do not actually need to negotiate with you. If your lenders deny your application, it is suggested that you try again with your current lenders before you approach other lenders.
If your negotiation process does not prove to be fruitful, you could then opt for the debt consolidation option. There are two functional ways of emerging debt free in the near future, as mentioned below. The first way is for credit cards; a method that states that you could merge all your credit card accounts onto one credit card. This credit card consolidation method would help you to effectively get rid of the high interest rates that you have been paying for multiple credit cards, amounts that could total up to thousands of dollars per year. It is recommended that you scout around for a brand new credit card that offers a low introductory interest rate, probably transfer all your outstanding amounts onto the new card, and then start paying off your debt.
The second method is by making use of a debt consolidation loan. This method is also highly popular amongst the population, especially if you would like to do away with credit cards once and for all. This solution also works for other debt forms such as student loans as well as personal loans. Obtaining a debt consolidation loan may not reduce your debt. Instead you may be merging all your debt accounts into a single account, and reducing your interest rate significantly. Having a single debt account would also prove to be easier to manage, and ultimately more convenient to clear in the near future. A debt consolidation loan that you might want to consider is the home equity loan, where you borrow against the equity that you own within your home. Or you could also find several other debt management companies out there that offer debt consolidation loans for your benefit.
