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Credit counselling

How to Find the Right Credit Counselling Services

November 3, 2013 by editor

There are many people that are struggling each month financially and this can increase the stress that people are under especially at certain times of the year. So, using credit counseling services is the first step in getting control of your financial situation, this is why it is important that you get this first step right.

How to Find the Right Credit Counselling Services

There are many credit counseling services around and it is important to find the right one, the one that is going to help you and not make your situation worse. Many of these companies make some great promises of what they are going to do for you, but what you might not be aware of is that many of them fail to deliver even on their basic of promises.

What is important is learning how to find the right company and what questions you should be asking and why, before you sign any agreement with them.

Questions to Ask

Knowing the right questions to ask the credit counselling service is going to mean that you will spot the companies that you should walk away from. It will give you the power that you need, especially when you are in financial difficulty. Many people are able to use this weakness against you and this is why so many people fall into a trap, they allow themselves to be drawn into a company and agreement that isn’t good for them.

  • Free service – many companies will offer a free service and it is important that you get the information about what they offer for free. Some companies offer more than others, but it doesn’t mean that it is going to give you any more information. If it is a non-profit company they will still need to have money, ask where it is coming from, or when you are expected to start paying for the services they are offering.
  • Ask for fees and charges information before you get involved with the company. You might not like the prices that they are going to expect you to pay, it also give you a chance to see if you can afford their services.
  • Ask about details of the accreditation and qualifications that the staff hold. Are they qualified to do the work?

It is important to realize that those companies that are honest and genuine will give you all the information that you have asked for. They will not generalize any of their answers to you. But it is still important that you don’t sign up with the company until you have done your own research. You want to make sure that they are accredited and they have no complaints lodged about their services. A good way to judge a company is to make sure that they are capable to do what they are claiming and this is through clients that they have worked with, look up information about the company and if there are any negative comments that company might not be the right one for you.

What They Offer

Knowing what a company is going to offer can help you decide if that company is the right one for you. Do they offer more than just the counseling services? You need to find the credit counseling service that is right for you.

You can check to see if the company is registered with the NFCC, (National Foundation for Credit Counseling), they can give you information about good companies in your area, they should tell you about the companies that have complaints against them too.

As a minimum the credit counseling will help look at your budget and what changes you need to make so that you are in a better position financially. But they might also offer a debt management plan; this is where they get involved with your creditors. They might be able to reduce the interest that you are paying or get late fees removed, they won’t get you debt cleared that will take hard work and time on your part. But they might suggest that you pay them a set amount each week or month and they pay your creditor direct. The disadvantage with this is if they make a payment to your creditors late it doesn’t affect them it will affect your credit rating.

Check List

  • Check the services that they offer, do they meet your needs?
  • How do they set their fees? Are there any initial set up fees? Do they also charge a monthly fee? How much is this fee?
  • Ask the company what happens if you can’t pay? Will they help you and offer you advice and support? If they don’t then this company isn’t going to be the right company for you.
  • It is important to ask for a person to contact in the company, one that you can build a relationship with, if they refuse then each time you speak to the company they are either going to have to read your file or you will need to fill in your background again.

 

Filed Under: credit counseling Tagged With: benefits of credit counseling, Credit counselling, Credit Counselling Services, debt counseling

Consolidate Your Debt: Different Ideas

September 23, 2013 by editor

how to consolidate debt

It is important that you know how to consolidate debt if you are going to find the right solution for you. There are some great reasons why it is important that you should look into the possibilities of debt consolidation.

  • You will only have one bill to pay each month
  • The payment will stay the same
  • Interest rates should be lower
  • The overall cost of the debt should be reduced

There are a number of different ways to consolidate any debts and it is vital that you choose the right option for you. It is not going to be easy and it might take a bit of hard work but if the end result means that you are better off each month then it will have had a positive impact.

Reason Why to Consolidate Your Debt

It is important that if you are considering consolidation that you understand the reasons for consolidations and the final product that you are offered suits your needs and reflects in a positive manner on your credit file. You should not be paying more each month for your consolidation loan and you do not want the term to be longer than five years to be completely debt free.

There are many different options that are open to you if you are looking at how to consolidate then you might consider what options that you have available to you.

Approaching a Credit Card Company

You might be able to get a balance transfer to your current credit card, ask them for the best interest rate if you were to transfer and ask if they will not charge a fee. If they don’t offer you any savings tell them you will go elsewhere they might help you.

Do not apply to loads of different credit card companies because this will be recorded on your credit file and will have a negative impact. Always make any repayments on time because you might end up increasing the debt rather than reducing the debt.

How to Consolidate Debt with A Home Equity Loan

This consolidation loan means that you are borrowing money on any equity that you have in your home. This is the value of your home less any mortgage that you have outstanding, if you have equity then it is possible to turn this into a loan, but if you fail to keep up the repayments you can lose your home.

Refinance

It is possible to refinance your home and take out extra money with which you can pay off your bills and this will save you money each month. But you will be paying for the bills over the entire length of your mortgage.

Debt consolidation loans

It is possible to consolidate by using a consolidation loan, these can be more expensive and if you have a lot of debt they might not be the best option for you. The repayment might be higher and the interest rate might be higher too. Or the term that they are looking to hold you for could increase to 10 years and this is a long time. It is important that you know the true cost of the loan including the interest payment.

Credit counselling

It is possible to learn how to consolidate debt by going to a counselling service and they will help you to budget and work out a payment plan that will pay off your creditors. Some counselling services pays your debts and you just pay them once per month, check if you company is going to do this that they are reliable, if a late payment happens you will get the mark on your credit file and not the counselling company.

Settlement companies

It is possible to get a company that will act on your behalf to reduce the total amount of money that you owe. You pay the company the money that you would have normally paid your creditor and they work out a settlement figure and this is sometimes a lot less than the original debt, but this will have a negative impact on your credit rating.

Borrow against retirement

If you have saved up for your retirement it is possible to borrow money against the money that you have saved. It will mean that you have not touched your retirement money but have still had a relatively low interest loan.

Rapid payment

There are many different names for similar practices of how to consolidate debt without going to other companies but doing it on your own.

You need to list the debt that you have and with the highest interest debt pay that one more each month until it is paid and you move onto the next debt and focus any extra money there. You just need to stop using any form of credit until you have taken back control.

Therefore it is possible to take control of your finances and get the best product that suits your needs.

Filed Under: debt consolidation Tagged With: Consolidate Your Debt, Credit Card Companies, Credit counselling, debt consolidation loans, How to Consolidate Debt

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