ABOUT DEBT CONSOLIDATION ADVICE

Debt consolidation advice helps you tackle your multiple debts economically. With debt consolidation advice you can merge all your existing debts into one with low interest rate. This way you’ll have to pay only one monthly installment instead of many. The interest rate will be charged on a single debt instead of many. Also you don’t have to listen to the nagging calls from your creditors; instead you’ll be answerable to only your lender. Your debt consolidation adviser will help you get a debt consolidation loan at lower interest rate and flexible repayment duration. Debt consolidation advisor will also help you to manage your existing debts. With the help of your debt consolidation advisor you can get rid of your loans and lead a debt free life. Debt consolidation advice is also available for people suffering from bad credit status. A person can get a tag of bad credit due to reasons like arrears, defaults, CCJ, IVA, bankruptcy etc. but now they can also avail the benefits of debt consolidation advice. There are many banks financial institutions, lending firms that offer debt consolidation advice at nominal charges.

DEBT CONSOLIDATION ADVICE: ADVANTAGES

Debt consolidation advice is very important for people suffering from multiple debts. With the help of debt consolidation advisor such people can get rid of their loans and will be able to lead a debt free life. Debt consolidation advisor will help you obtain a debt consolidation loan at lower interest rate and reasonable terms and conditions. You don’t even need to search for a lender; your advisor will search the lender for you. Debt consolidation advice can be availed at nominal charges. You can use Internet to search for banks, financial institutions offering debt consolidation advice.

People with bad credit history can also avail debt consolidation advice, because debt consolidation loans are open for bad creditors also.

APPLYING FOR DEBT CONSOLIDATION ADVICE

Applying for a debt consolidation advice is very easy as there are many banks, financial institutions and lending firms that offer debt consolidation advice. You can use Internet to search for banks, lending firms that offer debt consolidation advice.

With debt consolidation advice you’ll be able to manage all your debts efficiently and economically.

For some, being bankrupt seems like the world has come to an end. However, there are some big advantages to wiping the slate clean and starting again from scratch. In the past getting a mortgage approved following bankruptcy was almost impossible but as the number of people falling into debt increases (currently seven thousand UK residents experience bankruptcy every year, the opportunity to gain approval for a bankruptcy mortgage is increasing. Happily the quantity and quality of bankruptcy mortgage advice is on the increase along with it so much so that it can be a real task to sort through this volume of bankruptcy mortgage advice and grab that which is most relevant to your personal circumstances. Here we highlight some of the most important information that will apply to anyone in this unfortunate position.

Firstly, it is crucial to understand that you will legally be required to declare that you are bankrupt. The thought of this may cause you a few sleepless nights assuming that you will never get a mortgage after bankruptcy; the thing you must remember is that these days there are many more lenders who are willing to approve a bankruptcy mortgage.

By following good bankruptcy mortgage advice you are definitely more likely to get approval a bankruptcy mortgage. Some good advice to bear in mind is as follows:

• Most Lenders prefer to wait two years after your bankruptcy discharge before considering a bankruptcy mortgage application. If you are in this position the chance of approval increases dramatically as does the choice of schemes available to you.

• Ensuring that all your payments after bankruptcy are made on time will increase your chance of getting a bankruptcy mortgage. A large deposit is definitely advantageous when applying for a bankruptcy mortgage. Good bankruptcy mortgage advice would suggest a deposit 5% to 15% of the property value will increase your chances of approval. Some lenders will look further into where the money for the deposit has originated especially if it has come from relatives. So be sure to check the lender criteria.

• It is vital that you get bankruptcy mortgage advice from a professional mortgage adviser who is regulated and approved by the FSA. Do make sure that you look at as many bankruptcy mortgage lenders as possible this will ensure that you have the maximum chance of getting a bankruptcy mortgage that best meets your needs.

• Ensure that all the bankruptcy mortgage advice you are given is fully explained to you. The mortgage advice you are given should be completely transparent. If you don’t understand the advice that you are being given then more often than not it’s an indication of inaccuracy.

• Remember that the people offering you bankruptcy mortgage advice are likely to have different commission rates from different lenders and schemes. To ensure that you get the best advice and choice of lenders. Seeks the services of a specialist FSA approved mortgage broker who sources from the whole of the market. FSA approved mortgage brokers are obligated to give you best advice and will find the right deal to suit your individual needs.

You must be flat broke to file for bankruptcy.

Wrong. The fact is, the only criteria to filing for bankruptcy are an inability to pay your debt as it comes due. Actually, waiting until your mortgage company is ready to foreclose to file for bankruptcy leaves you with fewer options to safeguard your financial future.

If you file for bankruptcy, you’ll never be able to get credit again.

Wrong. You can begin rebuilding your credit two years after fulfilling your debt requirements under your bankruptcy agreement. Although it will remain on your credit record for ten years, many people can begin to slowly rebuild their credit rating by paying their rent, mortgage and utilities on time; then applying for a low credit limit store credit card; and finally applying for bankruptcy loan when they are ready.

Once you’ve gone bankrupt, you can never own a home.

Wrong. Once you begin to rebuild your credit, creditors of all types – including mortgage lenders – will begin to consider lending you money. Your interest rates may be higher, but it is possible to obtain a loan. Sure, it’ll take awhile to prove to lenders that you can handle payments again, but it is possible to buy your own home following a bankruptcy.

Taxes cannot be discharged in bankruptcy.

Wrong. Some are such as personal income taxes that are more than three years old.

My student loans aren’t dischargeable under the new bankruptcy laws.

This one is generally true, but there are some exceptions. If the debtor can prove certain hardship, student loans may be dischargeable.

If I signed an agreement stating that a debt cannot be discharged in bankruptcy, it is my debt forever. Wrong. Although there are extremely limited exceptions, these bankruptcy clauses are unenforceable and are a tactic used to scare debtors into not filing bankruptcy.

I can lose my job if I file for bankruptcy. Wrong. It is illegal to fire someone for filing for bankruptcy. If, however, you apply for a new job after filing for bankruptcy, a potential employer can use the bankruptcy filing as a factor in deciding whether to hire you or not.

Now that you understand some of the misconceptions surrounding bankruptcy, you’ll be better prepared to make an informed decision as to what is best for you and your family.

What if your income dries up for any one of a thousand possible reasons? What if you lose your job? Are unable to work through illness? What if unforeseen circumstances mean that you are unable to service your debts? Modern life is expensive and it doesn’t take long to start owing considerable amounts of money. Maybe you’re just living slightly beyond your means and over a longer period you’ve found yourself owing a large amount of money. Do you bury your head in the sand, pretend it isn’t happening and simply wait for your debts to resolve themselves? At what point do you face up to the situation and or seek help?

Once you’ve decided to bite the bullet and take advice to try and deal with your situation, you then need to ask yourself where do you turn to? Who can you speak with to get impartial, independent financial advice? Who can you trust?

There are many ways to resolve a difficult financial situation and you will need input on what’s best for you. Look to take advice from a reputable and independent organisation with someone who can sit down with you and study the whole range of options available to see which debt reduction strategy suits your particular circumstances. From Individual Voluntary Arrangements (IVAs) if you are in serious debt and owe more than £15,000, to bankruptcy, debt management, debt consolidation and debt management – you need to explore all the options carefully.

Ideally you will be able to benefit from the input of a non-profit organisation experienced and expert in handling situations just like yours and able to offer the very best advice to help you escape your debt.

For example, if you are a young person, do you know that banks and credit card companies target you?  Students on college campuses and people who are under 25 are courted by banks because they don’t think about their purchasing choices over the long term.  More than 120 universities have cut deals with banks to issue student-ID cards that are also ATM and check cards.  Schools make millions of dollars from those deals.  In essence, colleges are offering up their students as sacrificial lambs to credit card companies.  No wonder people are in so much debt today, they’re taught from college that credit card debt is a good thing.  Debt settlement companies can help you grow out of the mistakes of your youth, and become financially free.
Courts may seem like a haven for those suffering under mountains of debt, but in all honesty the courts don’t care about your debt problems.  Since the late 1990’s, banks included arbitration agreements into their contracts, meaning you won’t be going to court if there’s a problem.  This means that rather than trying to sue banks over their activities, you will have to go through a private courts, which are heavily skewed towards corporations.  Debt settlement allows you to avoid such nightmarish scenarios and deal with your debt outright.

Also, did you know banks are charging extra fees for your overseas trips?  Your heavy credit card debt may be a result of a “once-in-a-lifetime” European vacation.  If you use a credit card to take money out of an ATM over in Europe, it may cost up to $7, plus any credit card fees on top of that.

Overall, credit card companies don’t tell you very much about their services.  Most of the unsecured debt that debt settlement companies help people with comes from credit card debt.  Part of this is that credit card companies don’t give you much information beforehand.  In spite of the pages of tiny text you get in the mail, credit card companies don’t disclose their inner workings.  In fact, during a 2007 investigation, The Government Accountability Office discovered that although banks are required by law to make fee information available to customers, one third of the banks investigated didn’t provide the required information.  Worse yet, more than half didn’t have any fee information on their Websites.

In the end, it’s important to remember that where you’re getting your information is important.  Debt settlement companies are on your side, and want to see you cut down as much of your debt as possible.  Debt problems can plague you for life, impacting your credit score, interest rates, jobs and more.  Contact a quality debt settlement company today to begin clearing out past debt and paving the way towards a successful financial future.

Determine What Your Biggest Debt Problems Are

In figuring out which debts are causing you the most trouble, there are several key factors to look at.  Obviously, one of the most important is to figure out who you owe the most money to.  Your largest debts are most like those you will be paying for the longest time, so it’s important to look at them first.  Next, you want to check which of your creditors demand the highest monthly payments.  Often the highest payment will be to the creditor you owe the most money to, but this is not always the case.  It may be that some of your creditors are willing to renegotiate with you for a lower monthly payment.  If you can do this, it may make it easier to make ends meet each month.  It is important, however, to make sure that you pay enough to cover the interest each month.  Otherwise, you may lose ground on the total owed.  This leads into the next major point to examine, which is the interest rates on all your debts and see which are highest.  Once you have these factors figures out, you can weigh which debts are causing you the most trouble.

Determine How Much You Can Pay Based On Your Income

This step is simple.  Look at the amount of money you earn each month and ask three questions. 1) What is your regular income? (How much you make) 2) What are you necessary expenses? (Food, clothing, rent, etc.) And 3) What is left over for paying creditors?  If the amount your creditors demand from you each month is higher than the amount you have leftover to pay them, it may be time to look at debt settlement options.

Choose A Reputable Company To Help You

If you decide to start looking for a debt settlement solution, make sure you look closely at the company or entity you enlist to help you.  There are predatory companies out there that exist to take your money and leave you worse off then you started.  In order to protect yourself, look out for companies tat claim to be able to eliminate you debt using nontraditional means.  Don’t go with any company that is not reputable and recommended by trustworthy sources.   Beware of companies that charge too much up front and don’t deliver an improved financial status.  If you have questions about a company, check them out through a consumer reporting to learn more.

Debt Settlement Companies

* Broken settlements – A settlement can be broken by either the party executing the negotiation or the customer. True, there have been instances were companies didn’t follow through on their promises to see the negotiation from beginning to end. The percentage of customers involved in those situations has been small and could have been prevented with some due diligence. Many companies have been drawn into the debt relief industry by the sheer numbers of borrowers and their escalating debt starting in the late 90’s. What had started as debt counseling run by a few non-profits mushroomed into an industry populated with thousands of new and inexperienced companies offering services far beyond the scope of the original mandate of assisting indebted customers with their debts Within those thousands of companies were those that didn’t deliver on debt negotiations, counseling, or consolidation.  Customers can also break a settlement by not making enough payments to settle the negotiation. Whether by circumstance or intention, some will stop making payments during the 18 to 48 months of the settlement process.  

* Credit scores – A debt negotiation will likely decrease the credit score of a borrower that enters a debt negotiation, but it depends on what that score is at the time the process starts. A vast majority of borrowers that start a debt negotiation are already behind on payments and are consequently taking hits on credit scores so the negotiation won’t have as much of an effect. The second issue on credit scores is that the negotiation stays on the report for up to seven years. While that can be true, doing nothing will leave charge-offs and open balances on the report indefinitely. Finalized, settled, and closed accounts are ultimately a much better reflection on a credit report than accounts that appear intended and/or neglected.

* Direct negotiation – Borrowers can initiate direct negotiations and, in fact, may be contacted by their lenders to do so. One problem with going direct is that there are normally several accounts to be negotiated, all of which will need to be done independently. A second issue is that the offers in direct negotiations are usually for lump sums or for payoffs within a few months of agreement. Those types of payments are often unworkable for the borrower, especially if there is more than one lump sum agreement at a time.  

The benefits of debt negotiations are as follows:

* Immediate relief – Upon initiation of the debt negotiation, the borrower will immediately experience an approximate reduction of 50% on payment obligations for all accounts involved in the negotiation. Reductions can vary, depending on the borrower’s ability to pay. By making payments in excess of the 50% reduction the borrower may be able to pay off the negotiated balances faster.

* Debt balances cut by 40 to 60% – Depending on the creditor, balances can be negotiated down by 60% or more. For a negotiation covering multiple accounts the average reduction for the total is 50%. Once the negotiated balances have been settled the accounts are considered to be paid in full with no further obligation by the borrower to the lender.

* A wide spectrum of accounts which can be negotiated – A debt negotiation can include credit cards, signature loans, department store debt, unpaid medical bills, unpaid utility bills, and more. This effectively gives the borrower a chance to wipe the slate clean without the disadvantages of filing bankruptcy.

* Paying off all debts within four years – As credit card balances have accumulated for consumers over time, making payments that materially reduce the principle balance has become difficult, if not impossible. For those that can only afford to make minimum payments, a full payoff could take twenty five years or more. Calculated out over that time a borrower would pay many times the actual balance in interest alone. Contrast that scenario with a full payoff of debts over four years or less at approximately half the balance amount and the merits of debt negotiation become very apparent.

* Increased odds of approval for home loan modifications – A debt settlement can enhance an application for a home loan modification by showing a reduction of consumer debt payments which allows for a greater availability of a homeowner’s income toward mortgage payments. In fact, a debt negotiation could be the difference between a successful loan modification and foreclosure.

You will continue to hear pro and con arguments regarding debt negotiations. One thing to keep in mind is that credit counselors have been and still are backed by credit card issuers. When listening or hearing about debt negotiations, always consider the source. If you are contemplating a debt negotiation, be sure to conduct some due diligence before selecting a firm to act on your behalf. Visit the firm and ask enough questions to get comfortable with the partnership. Insist on a law firm experienced in debt negotiations and, if applicable, home loan modifications. Getting back on your feet will take partnering with the right firm and a commitment to seeing the process through to its completion. Take care of those issues, and you’re on your way to financial freedom.