Should You Use Debt Consolidation For Easy Debt Relief?
Of the many options you have, a debt consolidation could be the one for you.
These services usually seek to find a way to pay off your debt in around five years, mostly by lowering a lot the interest rates.
There are six primary benefits these companies offer.
First, the company speaks to the creditors on your behalf and attempts to lower your interest rates.
Since the creditors and collection agencies want the money, they will often gladly lower your interest and get less from you in the long run, rather than the possibility of nothing at all.
Lower interest rates directly translate to less money you must pay off in the end.
Second, since your interest rate is lower, more of your money goes towards the actual balance owed.
Paying more of the balance on every bill can drastically lower the length of time you have to pay the creditors, especially if you previously paid only the minimum amount required every month.
Third, you only have one bill to pay each month.
The company will figure out how much you need to pay each bill, then send you one bill for the whole amount.
You only have to keep track of and pay that single bill every month.
Once you send them the money, they sort out where it goes.
Fourth, you could lower the calls you receive concerning bills.
A company will be speaking with the creditors or collection agencies on your behalf.
This can greatly reduce, or even eliminate, those annoying collection calls.
Fifth, if your debt is getting caught behind but has not gone to collection yet, you can keep it from ever doing so.
A collection account on your record is a major red flag to any of your future lenders, and will remain on your credit record for seven years, even if you pay off the collection agency.
Sixth, and perhaps most obvious, you can improve your credit.
Whenever you pay a bill late, your credit score can go down.
If the company brings monthly payments down to a manageable amount, and you can pay your bills on time now, there will be no more late fees harming your credit.
If you can get in a position where you can pay all your bills on time, you can even start building your credit score back up!