Accelerated Debt Consolidation, Say No to All If Terms are Not Clear
Accelerated debt consolidation could be the answer when debt gets out of hand. It is out of hand when you are having a hard time paying the minimum amount due on the bills. And they are piling faster than you can answer the calls from the creditors.
The first thing to do is to call the creditors to tell them about your problem and that you are working on a solution. Ask if there is anything they can do to help like not charging interest or high fees while you are in the process of working out a solution. Often they will try to help. They may even lower your interest rate if you ask them nicely. Don't lose your cool.
With this type of payment plan, you will be putting together loans that have high interest into one with a lower interest rate. The monthly payment will be lower also. This will make the debt to be paid sooner than if you kept at the old multiple debts you had.
But don't go spending the money you saved by going on this type of payment plan. Instead save that money for a rainy day like a sickness, a car that needs repair or the old fridge having gone kaput. Another way that you can use this extra money is to add more payment to the initial payment schedule.
The debts you incurred are classified into two types. They are the secured and unsecured loans. The secured loans are guaranteed by a collateral in case of default like your home, car and other loans that are secured by personal property. You could lose any of these once you miss payment.
Now, how about the unsecured loans? You probably know this by now through the process of elimination from the paragraph before this, but bear with me. It will be important later on. Unsecured loans are those that have no collateral like credit cards and personal loans. Now on to why we are discussing this.
Accelerated debt consolidation only deals with loans or debts that are not secured. There may be some exception but it is good to know this offhand so you will be armed and forewarned. Anyway, a good counselor from a reliable program will want to know your overall financial situation.
Here is where your knowledge about the difference between secured and unsecured loans will come in handy. If the counselor knows you know your stuff, then you will get a clearer picture. I am letting you know about this because there are people who told me that they went on this program thinking that they have everything covered only to find out later that they were not.
So read all the fine print, don't sign any agreement until you fully know what you are signing for. Although the accelerated debt consolidation may be the best option for you, it is still best to know every aspect of the deal you are trying to close. Don't rush and do ask a lot of questions.
In fact, get three companies and find out all the ins and outs with each one. Write down the answers to all your questions and when it comes to signing the agreement, be certain that those items you asked and the answers are incorporated in the agreement on the accelerated debt consolidation.
Accelerated Debt Consolidation, Avoid the Sharks! This way of getting out of debt is possible but watch for the warning signs in companies that have no guarantee, require you to pay by money order or debit your account right away, make you close and include all accounts and get your account numbers before giving a quote as all they need to give a quote are the balances, interest rates and names of creditors. They should also not keep your first payment as set-up fee Avoid those that advise you to include accounts with low interest rates already like the student loans and credit union accounts.
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