Personal loans such as payday or cash advance loans can be convenient ways of taking care of immediate debt issues. But if those debt issues do not go away, then you may find yourself in some trouble when it comes to paying those loans back.
One of the ways that people address the problem of cash advance loans is to consolidate those loans into a debt consolidation program. But there are several issues with debt consolidation that may not make this the best possible option.
Unsecured Personal Loans
Debt consolidation firms use several methods for consolidating debt, and most of the options wind up being some form of personal loan. Unlike the cash advance loan, these consolidation loans tend to last for between seven to 10 years and can become extremely expensive.
An unsecured personal loan is a debt consolidation tool that is based on the your credit score. If you have a decent credit score, then you may be able to qualify for an unsecured personal loan with a good interest rate. The problem is that many people looking to consolidate personal loans have bad credit and do not meet the qualifications of an unsecured loan.
If you have bad credit, then you will have to settle for an unsecured consolidation loan with a high interest rate. The higher interest rate may mean that the consolidation program will cost you more than your original accounts did.
Secured Personal Loans
Consolidating personal loans with bad credit usually means getting secured loans that require collateral. The problem that some people run into with secured loans is that they do not own collateral that would back up the loan.
The Truth About Consolidation
Debt consolidation programs are not the best approach for people with bad credit. If your cash advance and payday personal loans are starting to pile up, then you need a practical solution that will allow you to get that debt under control.
A consolidation program will move that debt around and allow it to exist for several more years. What you need is a program that attacks that debt and allows you to pay it off in a fraction of the time.
Debt settlement is a way of consolidating your personal loan debts without using a consolidation loan. A settlement program will also lower your debt and bring it down to a level that will allow you to pay it off in two to four years.
First Step – Lower The Debt
A debt settlement company will negotiate with your creditors and get your personal loan balances reduced by up to 50 percent. Right off the bat, the debt settlement program attacks your debt and makes it manageable.
Second Step – An Installment Plan
Once your negotiator has arrived at a payoff amount with your creditors, he will then negotiate a monthly payment amount. The settlement expert will want to get an amount that you can live with but also one that will get the debt paid off quickly.
Third Step – Your Monthly Payment
After the debt settlement expert has negotiated your payoff amounts and monthly payments, he will gather all of that together into a single payment that you make to the settlement company each month. It is the only way for consolidating personal loans with bad credit that really lowers your debt quickly.
Final Step – Managing Your Finances
When the debt settlement program is in place, your monthly obligations will drop by hundreds of dollars and you will have extra cash each month that you did not have before. The debt settlement expert will help you develop a personal budget that will pay your debt off quickly and prevent debt problems in the future.
Your Credit Score
A consolidation loan will be dragging down your credit for seven to 10 years because it does not offer any way of lowering your debt obligation. A debt settlement program will help you build your credit score faster because it will significantly lower the amount of debt you have.
A capable debt settlement company can help you to consolidate personal loans even if you have bad credit. Not only that, but the a debt settlement program will also help you reduce and then eliminate your debt quickly.
Call us today, and let us show you how we can lower your personal loan debt and give you back the financial freedom that you have been looking for.