Monthly Archives: July 2015

Good tips for navigating debt consolidation in 2015

If you are besieged by too many debts and bills to pay each month, one option you should take into serious consideration is a debt consolidation loan. By consolidating your debts you will just have one payment to worry about each month, and the potential to save money each month. How do you save money with a debt consolidation loan? Simply put you may qualify for lower interest rates. When you consolidate your debts, or roll them into one loan, you will have a new interest rate, and this new interest rate may be lower then one or more of your original debts.

However simply consolidating your debts will not get you out of debt in and of itself. There are plenty of pros and cons to consider before pursuing a debt consolidation loan. Managing your debt is vital if you want to pay off your debt or debts entirely. part of managing your debts is to set up a proper budget so that you can ensure that not can you meet your debt payments or your consolidation loan payments, but also have enough money on hand at any given time so that you do not need to resort to borrowing money again.

If you do opt for debt consolidation, there are some tips that can help you succeed at paying down your debts, while avoiding new debts. The key is to keep your total costs and payments down and reasonable, while maintaining a proper cash flow. Building up a savings account for a rainy day does not hurt either. Here are some debt consolidation tips to get you off to a fresh new financial start on life:

Terms
Try not to stretch out your consolidation loan to the maximum allowable terms. If at all possible make up a plan to dig yourself out of debt in only 3 to 5 years. Of course you will need to budget, possibly needing to cut some of your fun money out of your budget, but the results are well worth the effort. Also the longer your terms are, the more money in interest you are paying. Think about flushing thousands of dollars down the toilet or lighting up hundred dollar bills, that is basically what you are doing if you extend a loan longer than absolutely necessary.

Fine print
This should be a no brainer here, but you would be surprised at how many people enter into financial obligations without even reading the fine print. Fine print is there for a reason you can be sure, so you want to know exactly what, if any surprises are written out in that fine print. Things like balloon payments, application fees, interest rate changes, penalties and more are written up in the fine print.


To good to be true

There is an old saying about something to good to be true, and this is the case when it comes to financial products. If you see an outrageously good offer that seems to good to be true, it most likely is. There are many scams out there, so you must be very prudent when it comes to selecting who you give your business to.