Ways to Find a Good Debt Consolidation Service
Debt consolidation should be considered by anyone with debt, whether you have good or bad credit.
In most cases, consolidating loans will result in more affordable monthly payments and less accumulated interest over the life of the loan.
If the majority of debt is carried on high interest credit cards, which often offer annual percentage rates of 25% of higher, refinancing even modest amounts can result in thousands of dollars in savings.
The first step in the consolidation process is taking stock of your financial situation and cataloging all sources of outstanding debt.
This means contacting credit card companies and lenders and requesting the payoff amount for all loans, as well as the interest rates charged.
This information will be used both in determining the amount of a consolidation loan as well as the estimated monthly payment and the duration of the repayment schedule.
Another important factor in determining loan terms is the borrower's credit score and the contents of the credit report, so get this information as well.
After creating a spreadsheet with this information, you can begin your search for a debt consolidation agency.
Seek out services that provide free quotes to prospective clients and request information on interest rates they offer and monthly payment amounts.
The best way to find a reputable service will be through reviews written for people that went the debt consolidation route before you, those are first hand testimonial and you will find them in forums and blogs.
While it is important to find the lowest interest rate possible, be wary of any company that is offering a rate far lower than the average.
Many of the best agencies operate online, but predatory lenders exist as well.
Always research the reputation of any company with whom you plan to partner.
For that reason, checking at the Better Business Bureau will be always suggested, if you find that a certain company has lot of complaints it is probably a service not recommendable to go with.
However, a brand new company will have no complaints not because of an outstanding service but because they are simply new in the market.
Keep in mind that the repayment process will take many years.
The best debt consolidation companies offer trained customer service representatives whom you should contact as soon as there is a change in your financial situation or with any issues that may impede your ability to make a payment.
Take advantage of their expertise and willingness to help.
In most cases, consolidating loans will result in more affordable monthly payments and less accumulated interest over the life of the loan.
If the majority of debt is carried on high interest credit cards, which often offer annual percentage rates of 25% of higher, refinancing even modest amounts can result in thousands of dollars in savings.
The first step in the consolidation process is taking stock of your financial situation and cataloging all sources of outstanding debt.
This means contacting credit card companies and lenders and requesting the payoff amount for all loans, as well as the interest rates charged.
This information will be used both in determining the amount of a consolidation loan as well as the estimated monthly payment and the duration of the repayment schedule.
Another important factor in determining loan terms is the borrower's credit score and the contents of the credit report, so get this information as well.
After creating a spreadsheet with this information, you can begin your search for a debt consolidation agency.
Seek out services that provide free quotes to prospective clients and request information on interest rates they offer and monthly payment amounts.
The best way to find a reputable service will be through reviews written for people that went the debt consolidation route before you, those are first hand testimonial and you will find them in forums and blogs.
While it is important to find the lowest interest rate possible, be wary of any company that is offering a rate far lower than the average.
Many of the best agencies operate online, but predatory lenders exist as well.
Always research the reputation of any company with whom you plan to partner.
For that reason, checking at the Better Business Bureau will be always suggested, if you find that a certain company has lot of complaints it is probably a service not recommendable to go with.
However, a brand new company will have no complaints not because of an outstanding service but because they are simply new in the market.
Keep in mind that the repayment process will take many years.
The best debt consolidation companies offer trained customer service representatives whom you should contact as soon as there is a change in your financial situation or with any issues that may impede your ability to make a payment.
Take advantage of their expertise and willingness to help.