debt consolidation loan

Cash Advance Debt Consolidation

February 23, 2014 by illinois

You might want to take out cash advance loans as they do seem like the right option for your cash needs on a short term. The claim of these loans is usually that they will help us in times of financial needs and that it will help you to save up some cash for times of needs but the truth is a bit different. These cash advances are really not as convenient as they might seem and they usually get you under high debts that are hard to pay off.

The Loan Debt Trap:

If you take a cash advance loan, you end up getting deeper into debt. The term debt trap means that you think you’re making things easier for yourself taking an advance cash loan but it’s a trap because in the end it’s also a debt. So you’re piling them on yourself. At the end you end up paying more than what you initially did.

High interest rates are the reason for making cash advance loans a debt trap. Cash advance loan needs a payback in a very little span of time like a about one or two weeks. On your final due date of the advance loan you have to pay back the whole amount plus the fee added. The high fee is tricky and difficult part.

Different lenders have different free. Most of them have like thirty dollars on every hundred dollars you lend. As per the lenders demand, this fee varies mostly in range between $10 – $30 for every $100 dollars. Dome lenders have higher rates unless they are stopped by legal authorities.

A range between 300%-800% is the annual average interest for these cash advance loans in most states. If you don’t pay the full amount you pay the fee and extend your repay a week or two.

Getting out of the trap:

Once you have ended up with some cash advance loans you start thinking about how to get out of it and balance your financial situation. Cash advance loans have full repayment at once which makes it differ from credit cards and some other types of loans.

Luckily there are solutions available to get you out of this hard condition. The first step towards getting things right is by cash advance debt consolidation.

This procedure starts with discussing with the creditor. Because of the very high amount of fee it is likely that in the end of payback of your loan you pay more than the total amount of the loan. At that time, you will need someone to help you out getting back on track.

Cash advance debt consolidation through discussion begins with requesting for lower fee and a step by step repayment plan. Payday lenders are required to accept this request and accept a gradual repayment plan for you. So you can get the situation on uphill from here by professional negotiation.

Negotiations can proceed with making a payment plan or lessening interest by requesting a settlement. A settlement works by requesting a lesser principle amount. With loans, you are prone to wind up paying great past the beginning rule regardless of the possibility that you repay it back in two months. Settlement can help you figure out how to clear the debts without further inconveniences by making an arrangement that makes the loan affordable

Benefits of Consolidation and Settlement:

As soon as you decide that cash advance debt Consolidation and settlements are the best solution for you, you will start getting benefit from it.

The most prominent benefit is that you get debts that’s are more affordable and will help you get out of this whole scenario. for instance if you have fallen for a debt trap promising quick cash you need help to get out of that. Consolidation and settlements will help you to get out and beyond of the debts while the solutions remain affordable for you.

Another advantage is that your credit score gets higher. You will definitely have to start working hard on maintaining a good credit score but as soon as you start the settlements, the rating will start increasing and improving almost at the same time. a negative effect if there for a short time period and will eventually improve with every month that passes. When you get the debt pay backed you can start focusing on other bills that’s will start making your score better and improve.

Cash advances can no doubt be difficult to cope up with once they get huge and out of control. But for your advantage, there are two things named as consolidation and settlements which can help your situations and in the span of a short time all you’re problems will be solved and hence you can be debt free of cash advance loans as well as other debts you may be under.

Ways to Solve Your Debt Problems

September 26, 2013 by illinois

The most prevalent trouble that people are involved in is called debt. Your debt problems can cause many problems with a relationship as well as both physically, emotionally. There are many times that people don’t even realize there are options to help overcome your debt problems.

Ways to Reduce Debt Problems

There are many ways that people will talk about reducing their debt problems. However there are a few well known options that can offer the most success. There are companies designed to help you through you debt problems. These debt management companies offer several options such as

Debt Settlement
Debt Consolidation
Renegotiation
Bankruptcy

Each person must decide for themselves which program that can help their debt problems the most. Using a debt management company can offer benefits that you could benefit from. A credit counselor can help you assess your debt as well as help you to find a solution that fits your budget. They can help through creating a budget to help you learn what you can afford. They are able to negotiate on your behalf to the creditors to help a person reduce their total debt. This can decrease your required monthly payments. Several of the options involve a counselor taking your payment made to them and dispersing it to your creditors based on an agreement.

Debt Settlement

A debt settlement is one of ways to end your debt problems. A debt settlement is when you use a third party to negotiate with your creditors. The third party can help to reduce your debt and can offer settlement options based on what’s best for your budget. When it comes to debt settlement your creditors can pick one or two options. First they can either compromise on a settlement which will be less than what they wanted. The alternative is to lose the entire debt, this happens when a person has been unable to fix their credit and they file for bankruptcy. For this reason you creditor are able to work with your debt management counselor to reduce your debts up to 50% sometimes. This is one way to ensure that your debt problems don’t hurt your credit any further. This is one of the fastest ways to become debt free.

Debt Consolidation/ Debt Consolidation Loans

Debt consolidation programs are another way for someone to deal with their debt problems. This form of debt management can also be handled by a management company. This is different than a debt settlement. Debt consolidation is designed to reduce payments or payoffs. The debt management counselor will also act as your negotiator in this situation. After principals, interest, and fees have been lowered the counselor will act as the in between. An account is set up for you to place your monthly payment into and the debt consolidation company will then disperse the payment amongst your creditors.

A debt consolidation loan is very similar to participating in a consolidation program and can help with your debt problems. The debt management company will help you to reduce the debt you owe your creditors. Rather than having an account and letting them disperse the money, you obtain a loan that’s used to pay off the negotiated debt amounts. This will combine all of your debts into one payment, by leaving you with one debt. This loan can be lower interest than any of your current debts. Another positive to gaining a consolidation loan is that there are no negative effects to your credit.

There are some drawbacks to working with a debt consolidation company, and the Federal Trade Commission suggests against it. There have been cases where the management company has not made the payments on your behalf, or paid considerable fees that weren’t necessary. Remember that you should always be cautious and research the company that you choose to use to help you with your debt problems.

Renegotiating

When looking into renegotiating with you creditors to help reduce your debt problems it is important to have a goal in mind. The purpose of renegotiation is to reduce your interest rates to a very low number compared to your current interest rates. These interest rates can commonly be the main cause to your ever increasing debt problems. It can be troublesome to try and negotiate on your own, however it can be done. New terms and even new policies can be implemented in order to allow you to make your payments on time.

Bankruptcy

This option someone thinks about only if all other avenues have been exhausted. Fixing debt problems with bankruptcy can cause you to have a lot of negative repercussions. You will have bad credit for 7 to 10 years with little to no chance of recovery.

Be sure that the option that you choose is the one best suited for your debt problems.

What Is The Process Involved In Debt Consolidation Loan

May 19, 2013 by illinois

Sometimes, all it takes to be debt free is to find a systematic way of paying it off. The come-what-may attitude may get you deeper into debt and no where near your financial goals.

Any debt relief program is systematic. With debt consolidation loan however, you have to be careful because there is no professional assisting you unlike the others. This is why you have to know the process before you can successfully use it to your advantage.

First of all, you need to be able to make the minimum payment – or at least, only have a small deficit to it. Once you conclude you are able to make minimum payments, here are the steps you need to take to make debt consolidation work on your favor:

Step One: Self Realization
Accept the fact that you are in debt and figure out how much you really owe. This is a crucial step for you to move forward. You need to tally all the payments you are making monthly to find out the amount you are paying off on a monthly basis.

Step Two: Do the Math
Once you know the full amount of monthly loan payables, look at the nature of each for interest rates paid and if there are any prepayment penalties in the the event that you pay off your loan. This is a good decision point if getting a debt consolidation will be beneficial for you. It will also guide you in shopping around for the best lender.

Step Three: Explore the Lender Market
You need to look for a credit lender that will offer the best deal for you. But do not send out too many applications. This could and will backfire on your credit score. Shop around trustworthy recommendations or do the research on your own. A lower interest rate offered by a lender might lead to savings for you down the stretch. Prepare income documents as well because this will be the basis of lenders in taking a gamble on lending you money. They need to be convinced that you have the ability to pay off your loan.

Step Four: Go Back to the Main Objective
Once you find the right lender at the best rate, remember your main goal in choosing debt consolidation – to pay off all your debts and to manage one payable a month. It is much more simpler to remember one payment a month rather than juggling five debts each with different due dates, different interest rates and different penalties. As soon as you get the funds from your lender, pay off all your loan and close all credit cards. You can choose to keep one open in case of emergency.

Step Five: Pay Off the Debt
This is too important that reminding you again seems just right. You might have the temptation to use the money elsewhere. This mentality will get you deeper in the red.

Step Six: Do an Attitude Check
Probably the clincher of all the steps and another crucial understanding is attitude adjustment. Look at how you got into paying a lot of debts in the first place and steer away from that mentality. You might think that you now have less payments because you are just paying one debt a month. Falling into this false sense of security might encourage you to spend again and again. The next thing you know is you are in a lot more debt than from the time you started debt consolidation.

These steps will help you make the most out choosing debt consolidation loan in achieving a debt free lifestyle.