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Debt Consolidation Loan Directory

Find companies providing consolidation loan programs and related debt relief services. "Save time and money when you learn about and then compare financial services at DebtConsolidationLoan.com."

Debt Consolidation Loans and Other Types of Debt Relief

Learn the basics about consolidating your credit cards and other debts. Also, find and review directories of companies that provide debt help, as well as alternative options to getting a loan for bill consolidation. Use the menus above to find these online services and their websites, that provide various kinds of debt relief, including credit counseling and consolidation loan programs. These menus are organized by type of service or the state that you live in. Learn about common debt-related terminology below.

Consolidate Debt Without a Loan

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Unsecured Personal Loans for Debt Consolidation

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Personal Debt Consolidation Loan through LendingClub

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Terms – Terminology with definitions, along with those defined in the text on this page:

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What is a Credit Card Debt Consolidation ?

General terminology used to describe the combination of multiple debts owed to credit card lenders into one (typically) smaller and easier to manage payment amount. It is often assumed that getting a consolidation loan is required to consolidate debt, however, there are multiple methods of accomplishing this goal. Each type of debt help (or relief) has its own set of pros vs. cons, and the list can be different for each consumer depending upon their personal financial situation. Get more info and… Find Debt Consolidation Programs.

This type of lending is can be used for consolidating credit card debt and other (typically) smaller bills, or for a wide variety of other purposes. They can be offered as unsecured loans, or they can be secured to a borrower’s personal collateral. Unsecured loans are usually available for smaller amounts of money and qualification is typically much more difficult than it is for other types of lending. Get more info and… Find Personal Loan Options.

Credit counselors may be able to help a consumer obtain better interest rates, get penalty fees waived and help them manage their personal finances better through a consolidation of debt that is managed by the credit counseling agency. The consumer makes one payment to the counselor’s firm, that (in turn) pays the borrower’s creditors. This is why this type of service is also referred to as debt management. Get more info and… Find Credit Counseling Help.

This form of debt relief is the process by which a company negotiates a lower balance on a consumer’s outstanding debts with their creditors. The credit accounts are closed and the consumer agrees to make payments, per a schedule, until the balance is paid off. However, any amount of forgiven debt may be considered taxable income. Get more info and… Find Debt Settlement Services.

What is a Debt Consolidation Loan?

  1. Borrowing from a lender to consolidate bills may or may not lower the borrower’s current interest rates, overall interest cost or even the minimum monthly payment amount. a) The available interest rates on a consolidation loan approval may actually be higher than the existing credit card debt and other bills that you want to pay off. If approved, most of what determines the rate offered is due to your credit rating and the type of loan that you have applied for.
  2. Loans are more difficult (in some cases, much more difficult) to obtain than other forms of debt relief services, such as credit counseling / debt management, debt settlement or bankruptcy, as they have a qualification process that relies upon a set of underwriting guidelines, rather than just required actions on the part of the consumer. However, they are much less likely to have a negative impact on your current credit rating. Your credit score may be impacted by taking out new debt, but mainly, just be sure to make your payments on time.
  3. A debt consolidation loan is either unsecured, or secured to an asset or assets of the borrower.

Next Up: What are Secured and Unsecured Debt Consolidation Loans and what are the different types?

Other Debt Relief Program Pages

Review the following directory pages for listings of more companies and services providing debt consolidation and related financial services to people in need of help dealing with credit card and other consumer debts.

  • Looking to consolidate your credit card debts and reduce your overall monthly payments? Review our directory site listings for non-profit credit counseling services and debt management companies providing debt help to consumers with debt problems throughout the US .
  • US-based listings of debt consolidation companies that offer credit card debt consolidation, credit counseling services and consolidation loans to consumers, students and businesses.
  • Need an unsecured personal loan for bill consolidation? These type of lending does not require collateral and is available to homeowners and non-homeowners alike.

Please choose a service or product selection based on your financial service type.

Please choose a service or product selection based on your state of residence.

Due to the overwhelming amount of consumer debt that scores of people take on these days, many, at.

An Overdrawn Account from Stolen Debit Card Information

A few weeks ago, I received an email and text message alert from our credit union, notifying me.

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Debt Consolidation Loans up to $100,000

Debt Consolidation Loans up to $100,000

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  • Consolidate bills into single payment

Options for Debt Consolidation

You have several options when it comes Debt Consolidation. Make sure you know which one is perfect for you.

Knowing the right things to consider when finding the right Debt Consolidation Lender is important.

We have some helpful reminders for those who are considering debt consolidation.

We’re providing you with the steps you need to take in order to start the Debt Consolidation process.

Choosing the Best Debt Consolidation Loans

To create the best list of Debt Consolidation partners for you, we’ve taken the following factors into account:

Before anything else, you first need to need to know if you qualify for the loan. Most lenders have a minimum FICO score – this represents their risk appetite. Even if you find what you believe to be the best company to get a debt consolidation loan from, you will have to look for other options if you do not meet their requirements. Therefore, if you have a relatively low FICO score, be realistic and expect higher APRs. On the other end, if you have an excellent FICO score, your options will be a lot broader.

Annual percentage rates (APR) and monthly payments

If you are looking at estimated APR and monthly payments, you should already have narrowed down the list of potential lenders on where you qualify. Of course, you want to get the best deal out there. However, understand that this is limited by certain factors, largely by your FICO score. What you will have now is a range of your potential interest rates you can accrue based on the information you gathered. Assuming you have the same loan term, the higher the interest rate is, the higher your monthly payments will be.

Aside from interest, lending institutions earn money through various fees. There are different types of fees that a lender can impose on clients, but the most common one is a prepayment fee. Your best debt consolidation loans will not come with fees unless they are very minimal. Know the fees associated with your loan. Otherwise you might be surprised when your bill comes.

If your credit rating is impeccable and you have found the perfect debt consolidation loan, you may find their payment process is indirect and very democratic. Is this still a viable option? You should always consider the accessibility and convenience of your lender. There are other concerns in your life besides settling your debt. If your chosen debt consolidation loan becomes a burden instead of making your life easier, you are better off with another creditor.

Lastly, assuming that you are no expert when it comes to how these things are handled, there must be qualified and competent customer representatives to bridge the knowledge gap for you. Even if you feel you are comfortable with a lender, you still must be certain that your concerns are addressed accurately in a timely manner. Especially when it comes to fees, there must be clear communication between the two parties. Without that, you might unknowingly hold wrong expectations and get very frustrated later on.

The decision must not be on your financial concerns alone. In the end, the loan is just as good as where you source it. Your choice must be a balance of all these factors, with some factors weighing more heavily than the others depending on your priorities.

Debt Consolidation with Personal Loans

Many individuals accumulate debt with various organizations. This can include things like student loans, credit cards, business loans, mortgages, and many other lending products.

One of the best ways to simplify this complex web of bills is with a debt consolidation loan. A debt consolidation loan is when you are given a loan to pay off other debts. The result is that your bills are consolidated into one place so you don’t have to worry about tracking multiple different payments.

You pay a fixed payment to your lender for a period of two to five years on average. Most consolidation loans are offered at a fixed interest rate, which gives borrowers the stability and predictability they might lack in their current financial arrangements.

Are you a good candidate for Debt Consolidation?

You might be a good candidate for a debt consolidation loan if:

  • You can repay your consolidation loan without accruing additional debt.
  • You have the right credit to obtain a loan at a better interest rate than your current debt.
  • You are having a hard time keeping up with multiple different payment schedules.

However, as with all financial products, there are a few things you should pay attention to:

  • Make sure you are aware of the fee the consolidation lender will charge
  • Understand what support you have access to, for example: will the lender pay your creditors directly?
  • Check if there is an advantage to having a co-signer on your loan.

Consolidation Options: Loans vs. Credit Cards

With the right credit, you can get a card that has an introductory 0% interest period. Transferring your current balances to this new card can save you money.

Something to consider, though, is that the introductory rate will eventually expire. If you haven’t paid off the balance by that point you could be in for a surprise when the bill comes due. The interest rate on credit cards is almost always higher than the interest rate on a personal loan, so if something comes up and you can’t pay off the balance on time you’ll face a large expense.

There are some distinct advantages to personal loans when compared to credit cards for debt consolidation.

The first advantages have to do with the structure of a personal loan. The fixed payments provide predictability on when you will be done paying your loan, and the interest rates are usually much lower for personal debt consolidation loans than they are for credit cards. In fact, because loans are issued through the banks, there are limits on how high of an interest rate they can have. For example, federal credit unions are typically limited to 18% per annum.

Another advantage is the way that the debt is treated on your credit report. Credit cards appear as something called revolving debt, which has a greater impact on your score than installment debt, which is how a loan is categorized. This has to do with the fact that credit cards have a credit limit, and using too much of your credit limit can negatively impact your score. These factors don’t apply to installment credit.

There are a number of ways that you can get personal debt consolidation loan, but one of the most common is to use online services to compare different lenders. Each lender has different policies and procedures, so it is important to understand how to compare different personal debt consolidation loan lenders.

With years of experience in various sectors of financial services, we have set up My Financial Help as a consumer guide. We are not contracted to one specific credit provider and our focus is to find you the best advice possible for your financial needs. Our network of service providers are based in Western Cape and Gauteng regions, but we also have a national help line available to those who prefer to talk to us first.

Because we subscribe to industry best advice, we would like you to see upfront what your loan would look like before you commit to any repayments, and the calculation is merely there for your benefit in order to give you more clarity on what your payments would typically be.

My Financial Help is a division of Pay Plan Solutions. Eugene Cilliers is a registered Debt Manager (registration number NCRDC1636) and serves of the National Executive Committee of the industry Representative body, DCASA.

Consolidate debt into a home loan

Mr Simpson was asking about consolidating all his debt into his property to take advantage of the lower interest rate of his home loan. He has a house worth R1 200 000 on which he owes R400 000. He had taken the home loan many years ago when he paid around R 600 000 for the property and at the time he qualified for a good interest rate at prime less one percent.

Consolidate debt into one payment

Although many people turn to debt consolidation as a means to reduce what they are paying, consumers should be aware what they are signing up for. People often attempt to roll shorter term debt like credit cards and store cards into a longer term loan in order to reduce the monthly payment. What they are in fact doing often carries a double penalty.

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Please note that all calls with the company may be recorded or monitored for quality assurance and training purposes. *Clients who are able to stay with the program and get all their debt settled realize approximate savings of 50% before fees, or 30% including our fees, over 24 to 48 months. All claims are based on enrolled debts. Not all debts are eligible for enrollment. Not all clients complete our program for various reasons, including their ability to save sufficient funds. Estimates based on prior results, which will vary based on specific circumstances. We do not guarantee that your debts will be lowered by a specific amount or percentage or that you will be debt-free within a specific period of time. We do not assume consumer debt, make monthly payments to creditors or provide tax, bankruptcy, accounting or legal advice or credit repair services. Not available in all states. Please contact a tax professional to discuss tax consequences of settlement. Please consult with a bankruptcy attorney for more information on bankruptcy. Depending on your state, we may be available to recommend a local tax professional and/or bankruptcy attorney. Read and understand all program materials prior to enrollment, including potential adverse impact on credit rating.

Can I Get a Debt Consolidation Loan?

Do You Have to Have Good Credit to Get a Debt Consolidation Loan?

If you're struggling to pay off your debts and can't find a good way to increase your income, you may be thinking about finding relief by other means. As you probably know, there's an entire industry that's devoted to helping folks pay down their consumer debts in a timely fashion. A significant amount of the activity that occurs in this industry involves a practice known as debt consolidation lending.

Debt consolidation loans are large loans that may carry relatively low interest rates. They are ideal for borrowers who carry large amounts of credit card debt. Debt consolidation loans enable these borrowers to pay off their high-interest debts and may dramatically simplify their debt payments.debt consolidation loan application form.

True to the "consolidation" in their name, debt consolidation loans are designed to reduce the number of monthly debt payments that a struggling borrower must make. Instead of 12 outstanding credit card bills, a credit card consolidation borrower only has to worry about making a single larger payment to his or her lender.

If you're behind on your credit card payments, you may be wondering whether you have to have good credit to obtain a consolidation loan. Unless you've been very lucky, your credit score is probably not as solid as you would like it to be. You might have a justified worry that you'll be unable to secure approval for your loan.

It would be ironic if you were unable to secure a credit consolidation loan as a result of your poor credit profile. After all, consolidation loans are designed to help borrowers who struggle with large amounts of credit card debt. Most such borrowers have less-than-ideal credit scores. Debt consolidation lenders that adhered to strict credit-score standards when screening borrowers would be cutting out a significant portion of their "target" clientele.

For this reason, it's possible to get a debt consolidation loan with bad credit. Many debt consolidation lenders are willing to issue loans to distressed borrowers. Unfortunately, such loans typically come with some problematic drawbacks.

High interest rates are one of these drawbacks. Whereas "prime" borrowers may be able to secure low-interest consolidation loans, borrowers who have poor or mediocre credit may have to pay through the nose for their loans.

Even in this low-rate environment, it's not uncommon for lenders to charge annual interest rates of 15, 20 or even 25 percent on their sub-prime loans. This might substantially raise your borrowing costs and negate any of your loan's potential savings. If you can't save at least 5 percent on your outstanding debts with a consolidation loan, this course of action may not be worth the hassle.

The potential need to collateralize these loans is another serious drawback. Although each lender's policy is slightly different, many may require you to put up some collateral as a condition of your loan. This could take the form of a car, house or other valuable asset. If you become unable to make the payments on your loan, this asset could be subject to seizure.

The prospect of doing further credit-score damage is a final weakness. Since these credit facilities are so large, the monthly payments on credit card consolidation loans can be massive. If you fall behind on your loan or become unable to make your payments at all, you run the risk of a credit-damaging default.

Once you default on your loan, your credit score will drop precipitously. In turn, this will make it difficult for you to take out another loan. Even if you can find a lender that's willing to approve your application, your new loan would probably carry a far higher interest rate than your original credit facility.

Before you take out a debt consolidation loan, you'll want to consider all of the credit relief options available to you. Although you may be able to secure a loan with a poor credit score, there are certain risks associated with this course of action. In the end, you're the only person who's capable of determining how best to tackle your unsecured debt burden.

Everything That You Must Know about Debt Consolidation Loan Before Applying for It

Hardly anyone in today’s world can claim to have fulfilled all of their responsibilities and wishes without needing to borrow money from time to time. Times are hard, and at some point in our lives, we feel the need to take a loan to manage expenses on time efficiently. However, repaying the borrowed sum may sometimes be challenging.

If you have multiple loan repayments to think about, and if the constant payment reminders are stressing you out, you might want to consider availing a consolidation loan.

With proper debt consolidation, you can bid goodbye to the burden of making multiple payments each month. You would only need to pay once and on a monthly basis after consolidating all your loans into one. Restructuring all existing debts and combining them into one may even help to reduce the overall interest rate to some extent. This type of loan can relieve some stress, both financial and psychological, by helping you to put a check on other debts that may keep piling up otherwise.

What is a debt consolidation loan and how does it work?

Debt consolidation typically refers to the process of taking out a loan to pay off multiple others loans, liabilities, consumers debts and so on, which are usually unsecured ones. This new debt may be massive in size, but it also has more favorable payoff terms. It may even come with a low-interest rate or lower monthly payment, and sometimes, it may come with both. This type of loans can be useful in paying off student debts, credit card debts and other forms of financial obligations that one may accumulate over a considerable period.

In theory, debt consolidation is only the process of financing multiple loans, but it is noteworthy that there are specific instruments which creditors can offer the borrowers. Creditors willingly do this due to many reasons. One of the main reasons is that this type of loan significantly increases their chances of collecting from a debtor. It is also one of the main reasons that established and recognized financial organizations like banks and credit unions offer debt consolidation loans to those who face difficulty in managing their payoffs or the size of their outstanding debts. Due to this, debt consolidation companies have also become quite prevalent over time.

Which types of loans can you consolidate with debt consolidation?

There are quite a few types of loans that you may want to consider while consolidating your debt. Out of these, the most common ones are:

  • Home equity loans
  • Credit card balance transfers
  • Personal loans

Home equity loans: This loan is taken out by using the equity in your home as collateral. A fair amount of capital and good credit are the prerequisites for a home equity loan. Even though this financial arrangement puts your home on the line, it does come with typically low-interest rates. Down the path, if the payments become too much to bear, you can go with foreclosure on your home.

Credit card balance transfers: This service enables you to transfer your credit card balances, all of them, into a single credit card. It also comes with a low-interest rate. What is noteworthy here is that low balance transfer rates are mostly promotional rates, and in most cases, they expire after a period of six months. So, you must keep track of time and note when the typical transfer rates will start to apply. To use credit card balance transfer in a debt consolidation loan, you must first have a credit card with a credit limit that is big enough to hold all your credit card debt.

Personal loans: As per the experts at nationaldebtrelief.com, personal loans are a popular choice for debt consolidation. However, you must first be able to get a loan that is large enough to cover all the balances you may have. A personal loan is an unsecured loan. It comes with the condition of fixed payments over a stipulated period. Upon approval, you may use your this credit to consolidate your debts.

What are the main benefits of debt consolidation loan?

Debt consolidation loan, if you qualify for it, can certainly put you in an advantageous position, and that too, financially, socially and psychologically. Take a look at the five main benefits of going with debt consolidation loan:

Single payment: As stated earlier, this type of loan enables you to combine all your debts into one. This way, you only need to make one payment each month. When the loan amount has been paid off, you would have successfully taken care of all your debts and would not have to worry about any consecutive payments.

Lower interest rate: You can save a significant amount of money as this type of loan comes with less interest, especially when compared to the astronomical interest rates on credit card loans. With debt consolidation loan, you can save money not only on monthly payments but also over the lifespan of the credit.

Good credit score: Inconsistent payments compromise your credit score severely. If you manage to get your debts consolidated and stay on top of the monthly payoff, you can work towards rebuilding your credit score steadily.

End to collection calls: Often the failure to make payments on time leads to the creditor handing over the collection duty to agencies. It means that your phones start ringing more often with collection calls. It increases both financial and societal pressure on you. With a debt consolidation loan, you can put an end to such harassments.

Stress reduction: Can you imagine the peace when you know that you do not have to worry about paying off multiple loans, and when you are not disturbed by creditors’ call now and then? All you have to do is arrange for just one payment, on time, each month.

One fact to remember while trying to consolidate your debts with a new loan is that this borrowed sum is not exactly helping you get rid of your debt. You will still have to pay your dues; you will have to plan your finances efficiently, and you will need to be careful about not borrowing more. However, having to pay just one stipulated amount every month might make you feel relaxed. You are just shuffling the debt around to find a more manageable way to pay it off. Practicing discipline and avoiding any new loans until you repay the entire consolidated debt amount would indeed be wise. Try to reduce your expenses so that the need to borrow anew does not arise. In case of difficulty, you can always consult a financial advisor.

Financial Resolutions That Makes The Most Sense

As you head on to the new year, you might find yourself putting together another set of financial resolutions you vow to stick to for 12 months. More than promising to start eating healthy, hit the gym, start running, or even using that bike you’ve had for a while, your finances could also need a new direction for the year.

More often than not, these resolutions are done out of habit at the start of every year. Some people also put together these money resolutions because they went through a challenging time in the past year. As they try to avoid getting into the same situations, they resolve to manage their finances better. While for others, they simply want to achieve their financial goals much faster.

Whatever the reason is, these financial resolutions needs to make sense and be in line with your goals in life. You cannot just think of random things you will include on your list or goals you heard other people are aiming for. It has to be personal and give you the chance to make improvements in your personal finance journey.

If you are planning to put together a list of resolutions that aims to help you financially, here are a few thing to consider.

Be more conscious about online security

Technology has come a long way in advancing several industries including the financial sector. For one, it is now a lot easier to manage your bank accounts. You simply go online and check your fund balance. You can also shop in the comfort of your own home. For payments, you can also do most, if not all of it online without the need to fall in line.

However, together with progress and convenience comes a downside as well. For one, online scams can be a huge blow to your finances. It can wipe out your bank account and negatively impact your credit score as well. The best thing to do is be more proactive when it comes to online security. A lot of institutions are being affected including Equifax that got hacked in 2017 .

One of the first things you can do is put in harder passwords for your online financial accounts. The more complex the password is, the harder it would be for scammers to guess it. You also need to make sure that you visit legitimate websites and avoid downloading suspicious files on to your devices. These can have a virus that can do a lot of damage when it gets a hold of sensitive financial information.

One of the best financial resolutions you can ever make is committing to a savings goal. This can help you reach your goals a lot faster or simply keep you on track. The problem with most savings goal is that you end up losing interest early in the game because of the sheer target amount. The best thing to do is break the amount into smaller targets. This might even be the reason why CNBC shares that half of Americans have nothing saved for retirement .

If you are looking to save $2,000, that would seem to be a big amount at the start of the year. You can easily lose interest and focus. However, if you split that in half, that is only $1,000 half a year. If you split that even further, it would come out to $500 for 3 months and about $167 every month. Between $2,000 and $167, the latter seems a lot easier to plan for.

As soon as you start talking about financial resolutions, it involves a lot of planning for the future and this should include your children most especially for their educational needs. Higher education does not come cheap and cost of attendance usually goes up year after year. According to College Data, average in-state public college and private college is around $25,290 and $50,900 respectively .

That is a lot of money for young people wanting to go to college. The usual route of would be to take out student loans to pay for school. They then have to pay for it for years to come after they graduate. There is a good chance that you are also paying for one yourself. You should know that student loans are quite hard to shake off and sticks with you for a long time. If you can help your children get a better start with their finances after college, now is the best time to do that.

A big part of why you want to improve your finances is because you could be struggling with debt payment. There are a number of reasons why you could be in debt and usually, your credit cards are involved. From having the ability to pay for things you cannot afford to miss payments and being hit with fines and a lot of other charges, your credit card can quickly put you in serious debt.

This is the reason why a lot of people includes credit card management in their financial resolutions. There are actually a few ways to help you manage your card debt. One of the most important things you need to learn is when not to use your card. There are a lot of temptations when it comes to credit card purchases and it boils down to repayment ability.

If you do not have the ability to repay back the amount at the end of the month, better think twice before swiping your card. Minimum payments could help you stay current with small manageable amounts. However, you end up paying a lot more for interest over time. That amount could be better used for other financial goals.

As you start the new year, you can try and learn a new skill. This is one of the financial resolutions that can be your jump-off point not only in earning a lot more but it can actually allow you to cut costs as well. Just look at all the things that you pay money for around the house and you will be able to pinpoint skills.

If you seem to spend a lot of money in ordering take-out food, it might help you save money if you start learning how to cook. You can buy and cook in bulk over the weekend so you just reheat all throughout the week. You can also try to learn DIY repairs at home so you do not have to call for everything and anything that needs repairs.

Be serious about your reserve funds

Money and budget resolutions also need to protect you from unexpected challenges that you could face all throughout this year. This is why you need to make sure you include your emergency fund in your plans for the year. It will be your financial cushion in case you encounter emergencies such as being hospitalized or even losing your job.

There are a number of ways how you can put together sensible financial resolutions that can help you throughout the year. You just need to make sure that you think about your targets so you do not waste time with other resolutions that will not really help you achieve your goals.

Holiday Debt And How To Tackle Them Early On

At the start of the year, there is a big chance that you are thinking about holiday debt you incurred during that frantic celebration week. From gift giving to parties and even last minute travels, the holidays could have set you back in your budget. As a result, your first financial challenge for the year is overcoming that debt.

It might be a little disappointing because you are trying to get ahead at the start of the year. However, the debt you incurred is pulling you down and bringing you in a different direction. Rather than think of strengthening your finances, you are too preoccupied with thinking of ways to pay down your huge debt amount.

Americans added over $1,000 in credit card debt over the holidays according to CNBC. That is a big amount to overcome especially if it is not included in the budget. There are people who might be able to pay that holiday debt in a month or two. However, the reality is that a lot more consumers would have to pay for it for for a longer time.

This is one of the downsides of holiday expenses that went unguarded. As you enjoy the time with family and friends, you might have lost track of your budget. It is possible that you had one to start with but along the way, you just got into the moment and started buying gifts for everyone you know. You could have booked a last minute travel just to be with family and other people close to you.

These and a lot more could have resulted in accruing a lot of debt over the holidays. That being said, here are a few things you can do to get over that financial hump.

Now that you are looking at that mountain of debt you got over the holidays, the first thing you need is to review your expenses over the holidays. If the debt you accrued is all on your credit card, you can check your statements as well as the receipts you have for all your purchase. It would be better if you can list them all down so you have a working list.

Next thing you need to do is totally all of them and check if you come to that same total as your debt amount. At this point, it is a smart move to check each and every expense item. What you are looking for are anomalous transactions if any. Also, try to identify impulsive purchases that you made over the course of the holidays. It can help you identify your triggers such as sale promos or even seeing the same item from friends and family. This will help you avoid the same things the next time the holidays come around.

Have a concrete household budget

Once you verify the purchases that led to your holiday debt, the next thing you need to focus on would be your household budget . You need to have an idea what your financial capability is when it comes to paying off debt from the holidays. It is important that you know where you stand financially so you can pay off your debt.

Analyzing your household budget is a pretty straightforward process. You just have to factor in all your sources of income. Next is making a list of all your expenses that you have to attend to month on month. Much like your income, this needs to include all your expenses. From basic needs big-ticket debt payments, you have to include everything.

Start looking for a debt payment strategy

As soon as you have a clear picture of both the debt amount you owe and what you have in your budget, it is time to start thinking about a repayment plan. There are a number of payment strategies you can use to directly address holiday debt. Each of them has their own financial advantages and disadvantages.

One of the payment strategies is the so-called avalanche method where you set your sights on the accounts with the highest interest rate. This is meant to help you save interest payment in the long run. Another strategy is the snowball method where you set your sights on the accounts with the lowest payment amount. This strategy gives you mental wins that encourages you to pay off more debt items in your budget.

One other payment strategy you can look into is debt consolidation . From the name itself, the strategy involves combining your debt payments under one account. For one, it helps you manage your debt payments better. Once you combine your payments, you get to focus on much fewer details and lower the chances of overlooking payment due dates. You can also enjoy the benefit of lowering your monthly payments due to a higher credit score or longer payment period.

Widen the gap between income and expenses

When you start talking about debt payment, your budget plays a big role in determining how you pay it off. One thing you need to remember is that the wider the gap between your income and expense with your income on top, the better off you would be. This would give you more room in your finances and allow you to make extra payments towards your holiday debt.

The most common thing people do is to lower down their expenses. After you have put together your budget, you still need to conduct a thorough review, especially on your expense side. What you need to look for are areas to cut down further. The more expenses you free up, the more you have to double down on debt payments.

Another strategy that a lot of people prefer is looking for ways to increase their income. Traditionally, this used to involve taking on a second job. Something they can do after their day job such as bartending, waiting tables or even pulling double shifts at work. There are those that choose to take on online jobs to earn more money. Others prefer to earn from their hobbies which allows them to earn good money doing something they are passionate about.

Plan for the holidays early on

One of the most effective strategies to address holiday debt is to prepare for it early on. Now that you have an idea how much debt can set you back at the start of the year, you can choose to be proactive for this year. One of the best ways to do that is to make preparations so you do not go through the same mistakes once the holidays come around.

For one, you need to list down all the people that you gave gifts to during the last holiday. This will allow you to assess the overall picture. Next is planning early on what to give them and saving up for that expense. Putting aside a small portion every month is better than stressing out where to get a large amount come the holidays.

Holiday debt carryovers to the new year mostly because you were not able to plan for your expenses early on. It is still at the end of the year but if you plan on it early enough, you can enjoy the holidays without having to lose sleep over your debt payments.

Effective Debt Payment Strategies For The Year

As the new year dawns on us, one of the best ways to manage your finances is to look at effective debt payment strategies. You can simply choose to keep on paying the minimum on your financial obligations and that is fine. At the very least, it will keep you current. However, if you want to have better control over your finances, you need to re-think that strategy.

For one, you would end up paying a considerable sum on interest alone. Minimum payments tend to have interest fees tucked in on the amount. You also have to look at penalties and other related fees if you do not pay amounts in full. Overall, minimum payments can be easy in the pocket but can cost you a lot over time because of interest and fees.

One positive thing you have going is that your payment gets reported in your credit score . That is if you are making on-time payments. Late minimum payments will not only stain your credit report, it can also lead to a lot more penalties and fees than what you are dealing with at present. As a result, you pay more and your score dips.

These are just some of the reasons why you might want to look into effective debt payment strategies to manage your finances. It would be a great start for the year as you use strategies that can get you out of debt faster. The sooner you can do that, the more funds you can put into your future financial needs. That being said, here are a few things to go over to help you identify an effective strategy for debt payment.

On top of your list should always be an audit of your debt obligations. It is an important first step so you know what you are facing. This step is easy and straightforward because you just list down all your debt payments. From your mortgage loan to car loan, student loans, as well as your credit card payments. You need to be able to list all of them down.

The challenge starts when you are in debt denial with some of your financial obligations. It can be that one credit card that has already been maxed out. It might also be a payday loan you are trying to avoid. As you list down all your debt obligations, you need to be very honest with yourself and be truthful on what you put on the list. Only then will you be able to see the whole picture and look at effective debt payment strategies.

Tackle high-interest debt payments first

One effective strategy to pay off debt is focusing on the accounts with the highest interest rate. Sometimes referred to as the “Avalanche” or “Debt Stacking” method, this helps you save on interest payment down the road. This usually comes out to be your credit cards or other unsecured loans that you have taken out.

Take note that you still need to keep paying all your other debt obligations. You can put in a minimum amount on all while putting a little extra to that one payment with the highest interest rate. Once you have paid off one, you set your sights on the next highest rate and then the next one until you have paid off all your debt obligations.

Prioritize paying off smaller debt amount

When you start talking about effective debt payment strategies, you can also consider the “Snowball” approach which can fast track debt payments . Much like debt stacking, the priority this time are the ones with lowest total amount regardless of interest rate. As you finish one account, you simply add what you were paying for it to the second smallest payment. As you do this, you get to pay off your obligations one after the other.

What this debt payment strategy gives you are small mental wins that you can take to the next one. There is a certain feeling of accomplishment when you pay off any type of debt. It gets you excited to pay off the next one and the one after that. Soon you would have paid everything because you were getting those small wins at the beginning.

With the two options above, you still have to keep an eye out for each and every one of your debt accounts. Missing one could lead to bigger debt payments at the end of the month. If you have the ability to meet your payments but you are just struggling with keeping up with the payment schedule, you need to consider consolidating your debt .

This is one of the effective debt payment strategies that a lot of people have been using. As the name suggests, this will entail combining most, if not all of your debt obligations under one account. If you have five different credit cards with various lenders, you are juggling multiple payment details. From the due date to the payment amount and even interest rate.

Once you combine your debts into one account, you will only have to manage a few payment details. As you do that, you lessen the chances of missing a payment. In the process, you reduce the possibility of paying unnecessary fees and penalties. You can also lower your monthly payments either with a higher credit score or even by stretching the payment timeframe longer.

When you start to look at effective debt payment strategies, you might be tempted to just look at how you can pay it back. After all, that is the end goal. However, you can quickly get back in debt if you do not analyze the problem. Paying off financial obligations could simply be treating the symptom and not addressing the cause.

You might be able to pay off your credit card debt you accrued because of uncontrolled shopping. Value Penguin even shares that balance-carrying households have an average of over $16,000 in card debt. But sooner or later, you will be in debt again if you do not change your shopping ways. As you pay off your debts, you need to make sure that you keep your impulsive buying behavior in check as well. It will turn into an endless cycle of payment if you add debt just as fast as you pay them off.

When you pay off your financial obligations, it will be a big help if you understand why you got into that position in the first place. Is it because of impulsive shopping, an unexpected emergency, or even a medical need? As you identify the reason why, you stand a better chance of protecting your budget. This will help ensure that you keep debt at bay and protect your finances as well.

There are a number of effective debt payment strategies out there to help you address your debt problems. They can give you the chance to save on interest payment or even give you small wins to keep you going. Debt consolidation can also give you the peace of mind where you simply have to focus on one set of payment details every month. If you get to enroll it in automatic debit, you get to enjoy the freedom of checking in every month and be able to set your sights on more important things in life.

Build A Reliable Emergency Fund At The Start Of The Year

A reliable emergency fund is one of the most important financial tools you will ever come across. It is one of those things that you wish you never have to use. As soon as you start to consider using your reserve funds, it means that you are going through some financial challenges. None of them is a good sign especially at the start of the year.

However, you need to understand that most of your financial emergencies are out of your hands. From a broken washer, minor roof repair, medical emergency, or even job loss . These are all unplanned situations that you need to prepare for. Though there are times when your direct actions put you in challenging financial situations.

Whatever the reason is, you need to have a reliable emergency fund to get you through the toughest of situations. And there is no better time to focus on your reserve money than at the start of the year. You get a clean slate and you get to start early with it. The sooner you save extra money, the more you would have when you need it. Here are a few items to keep in mind when aim to save for emergencies at the start of the year.

You will always need a benchmark and when it comes to saving money, you always need to take a look at your previous household budget . As the new year is here, pull out your budget for the previous year. It can help you understand what you are working with and how you can save for future. Your budget needs to be on point when it comes to your income and expenses.

Before you start planning for emergencies, you need to have an idea how much you really are earning and what percent of that is going to expenses. This gives you a clear picture of what you can work with. It also gives you an idea if you need to make some changes this year especially if you are ending up with higher expenses that your income.

As you make the necessary changes to your budget get a grip on the amount you can work with, you need to set a goal. You need to understand that having a reliable emergency fund has a lot to do with your expenses. This is one of the reasons why you need to take a look at your budget before you set your sets out in getting your reserve funds in order.

Once you have an idea what your expenses are, your goal is to cover one month’s worth of expenses. As soon as you have enough for one month, you start saving for two months, them three, and so on. Some people would suggest having enough for six months. This is because the average time to look for a new job is around six months according to the Balance. The amount is up to you depending on lifestyle and past experiences.

Look for areas where you can cut costs

Now that you have an idea how much you need to have a reliable emergency fund, you can now start to look for ways to save up. As you have your budget with you, try to look at the expense side and identify areas to cut costs . There will always be some items you can do away with or even some bills you have forgotten is there.

One of the items you can take a look is your subscriptions. It can be anything from a magazine to music and even unused gym memberships. Take a look at what you can take out so you can save a few dollars. You can even try to take a bike to and from work so you save on gas and even bus or train money. The idea is to identify areas to save up on and put that amount towards your reserve fund.

Identify opportunities to make extra money

As you might already know by now, the best way to maximize cost-cutting measures in your budget is to increase your income. For some people, this is a little more challenging when compared with expense cuts. This is because they need to put in a lot of effort as they look for ways to earn money just to increase their take-home pay.

The most conventional way people try to earn extra money is to get a second job. Jobs, where they get tips, is a great one such as bartending. For others, they prefer to play to their strengths. Creative people can take up design work for various establishments in and around the community. Then there are some who choose to transform their hobbies into an income-positive venture.

Where to put a reliable emergency fund

Now that you have a goal and have identified ways to save that amount, the next step is to pinpoint where you can put that money. It is important that you understand that this is a delicate balance between access and limitations. The fund needs to be within arm’s reach in cases of emergency but not too accessible that you are tempted to use it for other purposes.

If possible, try to split up your fund. You can put a few in a safe place in the house and most of them in a savings account. If your reserves get too big, you might be tempted to invest that money. What you need to watch out for is getting the fund tied up for months when you invest. It limits your ability to get your hands on it when an emergency occurs.

How it helps you throughout the year

Having a reliable emergency fund can help you secure your plans for your future. There are also a lot of things it allows you to do. For one, it allows you take a certain level of chance in life. It gives you the ability to chase your dreams if you are not in that field yet. As you transition from a day job that pays the bills to do something you love, you have something in reserve in case your finances takes time to catch up.

You need to make sure though that you still have income coming in as you chase your dreams. This way, you only tap on your reserves in case of emergency. Having extra money as back-up gives you enough freedom to take risks as long as you are doing it with your future in mind. If you simply want to take a break to try and “find yourself,” you better save up for that trip rather than using your reserve fund.

It is important to focus on saving up for a reliable emergency fund at the start of the year. It gives you the elbow room to chase your dreams and even get through life’s toughest challenges. There will be a lot of unexpected situations in life that you cannot control. A serious health issue, losing a loved one, needing unscheduled repairs at home, or even losing your job. All of which can have an impact on your finances. Your reserve funds will help you weather the storm without taking on additional debt.

Debt consolidation means taking out a new loan to pay off a number of liabilities and consumer debts, generally unsecured ones. In effect, multiple debts are combined into a single, larger piece of debt, usually with more favorable pay-off terms: a lower interest rate, lower monthly payment or both. Consumers can use debt consolidation as a tool to deal with student loan debt, credit card debt and other types of debt.

There are several ways consumers can lump debts into a single payment. One is to consolidate all their credit card payments onto one new credit card – which can be a good idea if the card charges little or no interest for a period of time – or utilize an existing credit card's balance transfer feature (especially if it's offering a special promotion on the transaction). Home equity loans or home equity lines of credit are another form of consolidation sought by some people, as the interest on this type of loan is deductible for borrowers taxpayers who itemize their deductions. There are also several consolidation options available from the federal government for those with student loans.

BREAKING DOWN 'Debt Consolidation'

Theoretically, debt consolidation is any use of one form of financing to pay off other debts. However, there are specific instruments called debt consolidation loans, offered by creditors as part of a plan to borrowers who have difficulty managing the number or size of their outstanding debts. Creditors are willing to do this for several reasons – one of them being that it maximizes the likelihood of collecting from a debtor. These loans are usually offered by financial institutions, such as banks and credit unions; there are also specialized debt-consolidation service companies.

There are two broad types of debt consolidation loans: secured and unsecured. Secured loans are backed by an asset of the borrower’s, such as a house or a car, that works as collateral for the loan. More traditional, unsecured debt consolidation loans, which are not backed by assets, can be more difficult to obtain. They also tend to have higher interest rates and lower qualifying amounts. Even so, the interest rates are still typically less than the rates on credit cards. Also, the interest rate is fixed.

“Typically, the loan has to be paid off in three to five years,” says Harrine Freeman, CEO and owner of H.E. Freeman Enterprises, a credit repair and credit-counseling service in Bethesda, Md., and author of “How to Get Out of Debt.”

These types of loans don’t erase the debt; they simply transfer all your debts to a different lender or type of loan. (In circumstances where you need actual debt relief or don't qualify for loans, it may be best to look into a debt settlement rather than, or in conjunction with, a debt consolidation. Debt settlement aims to reduce your obligations rather than just reducing the number of creditors. Individuals usually work with a debt-relief organization or credit-counseling service. These organizations do not make actual loans; instead, they try to renegotiate the borrower’s current debts with creditors.)

Advantages of Debt Consolidation Loans

Freeman says that debt consolidation loans are most helpful for those who have multiple debts, owe $10,000 or more, are receiving frequent calls or letters from collection agencies, have accounts with high interest rates or monthly payments, are having difficulty making payments or are unable to negotiate lower interest rates on loans. Once in place, a debt consolidation plan will stop the collection agencies from calling (assuming the loans they're calling about have been paid off).

There may be a tax break, too. The Internal Revenue Service (IRS) does not allow you to deduct interest on any unsecured debt consolidation loans. If your consolidation loan is secured with an asset, however, you may qualify for a tax deduction. Debt consolidation loan interest payments are most often tax deductible when home equity is involved.

A consolidation loan may also be kind to your credit score down the road. “If the principal is paid down faster [than it would have been without the loan], the balance is paid off sooner, which helps to boost your credit score,” says Freeman.

For example, say an individual with three credit cards and a total of $20,000 owing at a 22.99% annual rate compounded monthly needs to pay $1047.37 a month for 24 months to bring the balances to zero. This works out to $5136.88 being paid in interest alone. If the same individual were to consolidate those credit cards into a lower-interest loan at an 11% annual rate compounded monthly, he or she would need to pay $932.16 a month for 24 months to bring the balance to zero. This works out to $2,371.84 being paid in interest. The monthly savings is $115.21, and over the life of the loan the amount of savings is $2,765.04.

Even if the monthly payment stays the same, you can still come out ahead by streamlining your loans. Say that you currently have three credit cards that charge a 28% APR; they are maxed out at $5,000 each and you're spending $250 a month on each card's minimum payment. If you were to pay off each credit card separately, you would be spending $750 per month for 28 months and you would end up paying a total of around $5,441.73 in interest. However, if you transfer the balances of those three cards into one consolidated loan at a more reasonable 12% interest rate and you continue to repay the loan with the same $750 a month, you'll pay roughly one-third of the interest ($1,820.22), and you will be able to retire your loan five months earlier. This amounts to a total savings of $7,371.52 ($3,750 for payments and $3,621.52 in interest).

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