The first place to look before you get a debt consolidation loan is quite simply at your self.
Do you see a person with very little self discipline and control over their money?
The second thing to do is ask your self why I have too much debt. Did something unfortunate and unexpected really happen or is because you just bought too many things on credit and you are not likely to stop!
The third thing to do is be bluntly honest with your self and consider the reason for taking out a debt consolidation loan. Is the real core of the problem your own poor financial knowledge and money management skills and a tendency to overspend no matter what?
7 disturbing facts about consolidate debt loans.Debt consolidation loans do not get you out of debt. They still remain your debts but consolidated into one loan. You will find the monthly payments are lower. This is because the interest rate is lower and the term of the loan extended over a longer period of time.
You do not owe any less; you just take more time to pay off the money. The longer the time, the greater the interest. This interest will cost you a lot more of your money. For example £10,000 over 10 years will accumulate £6000 in interest alone. £10,000 over 25 years will cost you a massive £18,000. These are the only a mid range of the interest rates charges at time of printing and have been rounded to the nearest thousand. They are only available if you have an existing good credit rating and you are a home owner.
The debt consolidation company that has consolidated your loan is not a charity but a profit making concern. They make their money from the interest you pay them. It is in their interest to have you paying interest for as many monthly payments as possible.
If the loan is secured against your house and you cannot keep up with the payments you could loose your home.
I am sure we have all seen Debt consolidation companies make promises like “you will have money left over to treat yourself to a new car or that holiday you have always dreamed about”. Stay clear of these ‘hooks’ for they will lead you into even more debt
When you sign up for a debt consolidation loan you will be signing a binding contract. This contract will have an impact on you and your financial life style for many yeas to come. You may make things seem a little easier to pay but that loan will be your financial burden for anywhere between 10 or 30 years! With a bit of effort to learn about personal finance, budgeting, frugal living and getting truly independent advice from the likes of Citizens Advice Bureau – www.citizensadvice.org.uk or National Debtline – www.nationaldebtline.co.uk you could be getting clear of the same debt in around 5 years but still remain debt consolidation free. You will have also learned valuable monetary skills along the way [...]
Archive for March, 2010
3 Questions To Ask Yourself Before You Consider Consolidate Debt Loans
Posted in Debt Cutback 
Tags: Before, Consider, Consolidate, Debt, Loans, Questions, Yourself 
No Comments »10 Ways To Reduce Debt || How Can I Save Money? ||
10 WAYS TO REDUCE DEBT
Do you really need to pay off your bills and reduce your monthly outgoings? Some cuts in spending are relatively painless, like for example, switching your gas and electricity supplies. But, if you have done all these easy methods, and still need to save money, here a list of other more painful sacrifices.
1. Live With Your Parents / Relatives
Yes, you may get nagged for not tidying your room, but, it could be a small price to pay for saving up to £500 a month. Due to expensive house prices, the cost of mortgage repayments and rent can take a very high % of your income. Living on your own may give you greater independence and freedom, but, unfortunately it is tremendously expensive. If you can bite the bullet and spend some time living with your parents, you can save potentially thousands in lower rent and mortgage payments. This can enable you to save up for a deposit or pay off your mounting debt. Of course, this relies on your parents being willing and able to let you stay; but if it is an option it can make a big difference. No one likes having to tell their parents what time they will be getting back, but, is it worth paying £500 a month just for this freedom?
2. Cycle to Work
Transport costs in getting to work, can become a high % of our disposable income. We may feel transport is an indispensable part of our expenditure, But, if we work less than 10 miles away there is no reason why we cannot cycle to work. True, it is not so pleasant when it rains or when cars seem indifferent to our existence on the road. But, cycling has some great advantages – very low running costs, no taxes to pay. Cycling will keep us fit, without having to spend money or time going to the gym. In some cities you may even find that cycling to work can be quicker than driving or getting the bus.
3. Give up Drinking / Coffee
Have you ever made a new years resolution to stop drinking alcohol / coffee? We know it will be good for our physical and mental health, but, it is also very good for our financial health. Many people spend far more on drinking than they may realise. The costs add up and when we are enjoying ourselves, we don’t keep a very accurate record. However, if you can stop, or at least cut down then you may be pleasantly surprised at the improvement in both our physical and financial health.
4. Cook For Yourself
A takeaway is quick and easy way to get food. But, the cost can soon add up. Even only 2 or 3 takeaways a week can soon add up to more than £30 a week, not forgetting the costs for lunch at work. It’s not hard to buy a loaf of bread and some cheese/ham and make up your sarnies for the week rather than [...]
Debt Relief ? How To Eliminate Unsecured Debt With A Legitimate Debt Settlement Process
The issue of debt relief in America has become a point of concern for the loan takers as well as the givers. Almost all financial and business sectors are facing this problem. Recession has hit us hard. A good number of people have lost their jobs and are unable to repay their debts on time. This has lead to a standstill in the global financial market. The only option left to ensure the continuous flow of cash in the market is to eliminate unsecured debts with a legitimate settlement. It is obvious that getting the whole amount is not possible for the money granting company. The solution to this problem is a coordinated settlement that aims to eliminate debt for the loan taker. There is a complete discussion in which the loan taker and loan giver present their arguments. It is an obvious fact that the company that the company would not get back the entire amount lent by them. The only solution to this problem can be a harmonious settlement between the borrower and the lending company that aims to eliminate unsecured debts. In the present times, this seems to be the only solution to bring about debt relief in America. The settlement process involves negotiation by both the parties and ultimately the debtor and the creditor come to a mutual understanding and agree to have a defrayal. The negotiations should be backed by powerful arguments. The borrower has to convince the authority with valid reasons and proofs. The creditor finally settles down at an amount less than what he has lent and the debtor has to pay it in order to eliminate unsecured debts. Usually, a professional process is applied to eliminate debt. The negotiation services provided by different settlement companies can be of great help in this case. They help their customers by lowering down the overall credit and interest rates. Here, it is important to note that there are several services offering debt relief in America. It is better to seek help from those debt relief networks that are allied to many established settlement companies in America. Getting out of debt through a debt settlement process is currently very popular but you need to know where to locate the legitimate debt services. To compare debt settlement companies it would be wise to visit a free debt relief network which will locate the best performing companies in your area for free. Free Debt Advice
Posted in Debt Cutback Tags: Debt, Eliminate, Legitimate, Process, Relief, Settlement, Unsecured No Comments »