Our Guide to Debt Consolidation

If you're carrying a high balance on your credit cards, and paying back the entire amount seems impossible right now, then you might want to consider credit card debt settlement.  This type of arrangement is not for individuals that don't feel like paying for goods or services they've purchased recently and charged on their credit card.  Negotiating with your credit card company is only to be used as a last resort.

Americans are carrying a lot of credit card debt, and that can sometimes lead to financial stress, payment problems, and bankruptcies.  In this publication, we're going to discuss some of the options individuals have when it comes to managing their credit card debt.  Options we'll discuss include:  credit repair services, self help, and even budgets.  These are all part of a do-it-yourself debt control process.

If you've been thinking about making a large purchase such as a new home or car, then you may be faced with a decision that involves a choice of buying credit insurance.  In this article, we're going to discuss the costs and benefits of purchasing credit insurance, as well as the types of credit insurance available to consumers today.

If you're one of the millions of Americans with credit card debt, recent changes to the credit card minimum payment formulas mean you'll be paying more each month.  This change was an effort to drive down outstanding credit card balances.  The move comes as a result of a 2003 suggestion from the Office of the Comptroller, which asked banks to institute the new standard by December 2005.

One of the increasingly popular ways to pay for elective health care services is the medical credit card. These specialized cards offer patients the convenience of paying for medical care using a credit card that provides attractive payment terms too.

It's a great feeling to get a "bargain" when shopping. That's something all marketers hope for when offering retail credit cards to consumers. Discounts are great, but there is a down side of accepting these offers too.

In addition to using a credit card to make purchases, most cards offer the cardholder the convenience of a cash advance. While the process of obtaining an advance is as simple as walking up to an ATM, the cost of taking out a cash advance is quite high.

When it comes to debt, the Great Recession will be remembered for the turmoil in the home housing market.  But when we're talking about debt, the news doesn't always have to be bad.  In fact, the time has never been better to reflect on past spending habits and start a plan to get out of debt.

In a down economy, this story is all too familiar.  Individuals wake up one day to find themselves overwhelmed by debt.  Money has been spent faster than it's coming into the household.  At the extreme, the household's debt load is so out-of-balance that bankruptcy appears to be the only alternative to eliminate debt.

If you have a lot of credit card debt, there is no need to feel like you're alone.  In fact, many people go through a phase in their life when they experience a "financial" crisis.  In this publication, we're going to talk about eliminating credit card debt.  This includes a discussion of how much debt the average person carries, as well as a process for reducing or eliminating that debt.

If you're looking to eliminate credit card debt, then you're not alone.  Americans carry an enormous amount of debt.  In 2010, consumer debt is expected to reach an estimated 2.4 trillion dollars according to the Federal Reserve.  That is nearly a 12% increase over the last five years.  Credit card debt alone accounts for over $886 billion.

Maybe you have a family budget that's helping to keep you out of debt.  Or perhaps your budget is working so well that you're running a surplus, and finding yourself thinking about this question:  "Should I start to pay down my debt or invest the money?"  Fortunately there are several relatively simple rules of thumb that can help you make the right decision.

Owning a credit card is a convenient alternative to carrying cash to make purchases.  But using a credit card has its drawbacks too, especially if your desire to buy goods or services overshadows your ability to pay for them.  Prepaid debit cards offer consumers both the convenience of electronic purchases, as well as protection against overspending.

For many of us, the years of carrying around a significant amount of cash are long gone. No more sitting on an uncomfortably fat wallet, instead we started to carry credit cards, a lot of them. Over time, we didn't want to carry "specialty" credit cards anymore; we wanted to streamline our monthly payments. Today, we're really down to two choices: a credit card or a debit card.

We're taught a lot of things in school, but how many of us were taught about the basics of putting together a household budget?  After all, financial independence is important to many of us, and the American dream is to own a home.

A Budget Worksheet is a useful tool if you've never put a budget together in the past.  Creating a budget is arguably the first line of defense against runaway debt, and we've described how to go about putting together a household budget in many of our debt consolidation articles.

In Budget Worksheet Part I, we explain how to go about creating an annual budget, and where you can find these budgeting tools - for free.  We also walked through the basics of creating a healthy, and sustainable, family or household budget

It's not always easy to meet our financial obligations each month, and that's where creating a family budget can help.  Nearly every day, we have multiple financial demands placed upon us.  Whether it is grocery shopping or paying the monthly electric bill, we're faced with family budget decisions all the time.

If you're wondering why you can't seem to save money each month, then we know the answer.  Saving money can be explained using one simple relationship.  When household income is greater than household expenses, then you're saving money.  On the other hand, when household income is less than household expenses, then you're going into debt.

It's uncomfortable to be in debt. No one likes the feeling of being out of control, especially when it comes to their personal finances. If you're in that situation, then you have two problems to solve: getting out of debt, and staying out of debt. 

The loss of a loved one is never easy. Until that deep mourning is over, it's also not a good time to make decisions with long term implications. Eventually, clarity of thought will return and it may be necessary to do some financial planning after the death of a husband, wife, relative, or close friend.

According to the National Bureau of Economic Research, the United States entered the Great Recession in December 2007.  While economists might define a recession as a reduction in a country's gross national product, indivdual families might be faced with extreme financial hardships, including the loss of a job.

For many of those in need, debt counseling can be a valuable service.  Debt counselors can help educate consumers about financial matters such as money management or household budgets.  They can also help consumers reduce their debt, as well as avoid bankruptcy or the loss of a home.

When searching for debt solutions, one of the more obvious options is debt consolidation.  Fortunately, there are several different viable solutions to the problem of growing debt.

Managing your debt properly is extremely important to the financial wellbeing of your household.  If mismanaged, your household debts can quickly increase until you reach a point where making payments become difficult or nearly impossible.

If you owe someone money, or are order by a court to send money to another party as part of a legal settlement, you could be at risk for wage garnishment.  Laws dealing with wage garnishment are aimed at both ensuring the party owed money receives payment, as well as offering protection against excessive garnishment of wages.

Perhaps you've finally reached the conclusion that you need some relief, or help, getting out of debt.  Maybe a friend has mentioned to you how non profit debt counseling would be helpful.  That suggestion seems obvious:  Why hire a for-profit counselor, when you can hire a non-profit debt counselor?

One of the established measures of household debt load is the debt-to-income ratio, or DTI ratio.  The measure is commonly used to determine if the household qualifies for a conforming mortgage or loan.  A large number of non-conforming loans were written prior to the Great Recession, raising the awareness and attention financial institutions give this measure.

In this publication on debt consolidators, we're going to talk about the various types of specialized services offered to clients.  For example, we'll briefly discuss consolidators specializing in student loans, Christian / nonprofit consolidators, and private lending institutions.  We will also talk about alternatives to debt consolidation loans.

Using a debt consolidation service can be a great way to put all of your outstanding debt together in one place.  With this type of debt service, you can convert your smaller loans, outstanding credit card balances, and leverage the attractive terms you can get with one larger loan.  But the benefits of using a debt consolidation service come at a cost.  Let's make sure you are prepared to work with a debt consolidator.

As financial distress continues to increase, many individuals seek the help of a debt consolidation service provider.  The speed and convenience of the Internet has facilitated a shift to online debt consolidation services.  Reducing or eliminating debt can be a risk-filled undertaking.  Making an informed decision can save you money over the long haul.

Many Americans seek out the help of Christian debt consolidators, and for good reason.  According to Federal statistics, about 4% of the U.S. population has $10,000 or more in credit card debt.  To many of us, that appears to be a lot of debt.  Even more surprising is that Americans owe an estimated $866 billion on their credit cards.

Seeking the help of nonprofit debt consolidation companies can certainly help to reduce your debt.  In this article, we're going to explain what non-profit debt help is really all about, and what you can expect from any company offering debt consolidation services.

If you have unpaid bills that are reaching a point where they are becoming overwhelming, then you might be thinking about contacting a debt consolidator.  A debt consolidator is a company, or service, that helps you to reduce your existing monthly payments by consolidating them into a more manageable loan.

If you're thinking about debt consolidation, then you may be trying to figure out if your best option is a debt consolidation mortgage or a consolidation loan.  For those of you trying to decide which option is the best way to go, here are some of the more important factors that you should consider.

If you're like many Americans, you may be considering a debt consolidation loan to organize your debt commitments.  We mentioned in our article on credit card debt statistics, that you're not alone if you find yourself with growing concerns over the amount of personal debt you've accumulated.

A car title loan is a loan where the vehicle itself is provided as collateral to the lender.  These loans afford borrowers the opportunity to acquire short-term cash in as little as fifteen minutes.  Unfortunately, this speed and convenience comes at a cost to the consumer.

The rent-to-own business involves dealers that rent homes, furniture, cars, appliances, electronics, and jewelry to consumers.  A rent-to-own arrangement provides the customer with immediate access to these assets for relatively low weekly or monthly payments.

If you cannot wait for your tax refund, then you can choose to find a lender that offers a tax refund loan.  These short-term loans use your federal income tax refund as collateral, and provide taxpayers with fast access to their refund dollars.

If a cash advance is needed to cover short-term expenses, then borrowers have the option of taking out a payday loan.  As the name implies, this type of loan is paid back when the borrower receives his or her next paycheck.

The latest statistics from the Federal Reserve indicate that the total amount of consumer debt outstanding remained fairly steady in 2010.  The total amount of consumer debt in the United States stands at nearly $2.4 trillion.  Based on the 2010 Census statistics, that works out to be nearly $7,800 in debt for every man, woman and child that lives here in the U.S.

Over the past decade, we've seen lower interest rates, a broken housing market, and virtually unlimited options when it comes to personal loans.  The end result is that Americans are borrowing money at a record pace - consumer debt is on the rise.  Still the question remains:  What are the real versus perceived risks of rising consumer debt?

Your credit score is very important to your financial health.  That's because credit scores are used by lenders and creditors to help them predict how likely you are to pay your bills in a timely manner.  Higher credit scores can also lower your cost of borrowing by allowing creditors to extend you a loan at a lower than average interest rate.

If you've ever spoken to a creditor or lender, they may have referred to your FICO® credit score or simply your FICO score.  That's because lenders have several ways of evaluating your credit risk, and your FICO score is one of the primary tools used by these financial institutions.

Fair Isaac recently instituted changes to its credit scoring formula to "ensure the continued reliability and predictive powers of FICO scores."  The new model, named FICO 08 made its way into the credit scoring process back in 2008.  The new model replaces the existing FICO model, which has remained relatively unchanged since the 1980s.

Regardless of your current credit score, good or bad, it never hurts to take steps to improve that score.  In this publication, we're going to run through some basic tips for improving credit scores.  But first we're going to briefly explain how those scores are calculated, because that knowledge will allow you to better understand how to improve your credit score.

Let's face it, many of us are just plain competitive and some of us are curious.  Then there are those that are worried about qualifying for a loan.  So what do these groups have in common when it comes to credit scores?  They all want to know how they compare to the national average credit score.

In an attempt to better service the creditworthiness assessment market, several of the credit bureaus have announced what are termed "thin-file" credit scores for individuals with "thin" credit histories.  By doing so, these credit bureaus allow lenders and creditors to reach an under-served market of Americans with little or no traditional debt payment records.

While many companies may throw around the term "credit report," there are only three companies in the United States that compile and publish credit information on consumers:  TransUnion, Equifax, and Experian.  These three credit reporting agencies are used by creditors to help figure out the risk they are taking by lending you money.

The Fair Credit Reporting Act, or FCRA, contains legal terminology that individuals often struggle to comprehend.  We're going to help you understand your rights under this act.  By doing so, you'll gain a better appreciation for how the entire consumer credit reporting industry works.

In February 2010, credit card holders were offered additional protections under the Credit CARD Act of 2009.  Signed by President Barack Obama in May 2009, the act offers credit card holders a series of industry reforms that help to lower interest rates, penalties, as well as fees.

Back in 2005, Congress passed into law some wide-reaching changes to the bankruptcy process.  At the time, it seemed these laws were aimed at making it even more unpleasant for individuals to file for Chapter 7 protection.  However, one of the unintended consequences of that legislation appears to be an increase in the cost of bankruptcy.

Several new bankruptcy law changes were passed back in 2005.  That's good news for the credit card industry, since they had been pushing for tougher bankruptcy laws for nearly ten years.  For many consumers, this new law meant a rush to file for bankruptcy before the October 2005 deadline.

Businesses that are no longer interested in continuing to operate, or individuals that do not have enough income to repay their debt, can seek protection from creditors by filing a Chapter 7 petition in bankruptcy court.  But filing for Chapter 7 comes at a great cost.  It requires the debtor to sell off all their assets and can damage credit ratings.

When businesses and individuals are failing to meet their financial obligations, they have the ability to file for Chapter 11 bankruptcy protection; although it is more common for individuals to file a Chapter 13 case.  Unlike Chapter 7 cases that involve the liquidation of assets, in a Chapter 11 case the business remains in control of its operation, while a court oversees the operation of that business.

Also known as individual debt adjustment, Chapter 13 bankruptcy allows individuals with a source of regular income to build a plan that allows them to repay some, or all, of their debts.  Under this bankruptcy chapter, repayment to creditors occurs over the course of three to five years.

If you're thinking about applying for a new credit card, or even buying a new home, then you might want to take a look at your credit report.  Whenever applying for new credit, it's a good idea to make sure there aren't any errors on your report.  The good news is that it won't cost you any money to get a copy, because you're entitled to a free credit report once every 12 months.

If you're thinking about borrowing money, then it's time to consider requesting a copy of your credit report, as well as your credit score.  This is especially true if you've borrowed money before, and your repayment pattern has been less than timely.  It's been relatively easy to obtain a copy of your credit report, but now there are companies offering free credit scores too.

If you've been paying your bills late, or not paying them at all, then you might be getting a call from a debt collection agency.  This is usually the final step in a lender's dunning process.  If that's true, then you should know your rights under the Fair Debt Collections Practices Act.

Companies are in the business of making their shareholders money.  To ensure their shareholders are getting what they deserve, companies need to carefully monitor and control the debt of their customers.

A number of identity theft regulations were signed into law as part of the Fair and Accurate Credit Transactions Act (FACT Act).  In particular, FACT Act requires financial institutions and creditors to develop, and implement, written identity theft programs by November 1, 2008.

If you don't think identity theft is something you need to worry about, consider this:  Recently published statistics on identity theft indicate that nearly 4% of the American adult population claimed to be a victim of identity theft in 2005.  Furthermore, one study indicates that the average amount of money obtained by the thief was nearly $1,700.

Perhaps the single most important document that can be used to protect against identity theft is your credit report.  That's because credit reports contain a wealth of information when it comes to financial transactions, as well as the process of accurately matching those transactions to individuals.

If you're a victim of fraud or identity theft, then there are steps you need to follow to report your identity theft to various authorities.  By taking the proper corrective action, you'll reduce the risk of further theft, and start a process that will clean up any of the inaccurate information on your credit report.

In today's marketplace, you'll find a growing number of companies offering services aimed at helping consumers fight against identity theft.  Fortunately, there are also steps you can take to help reduce your risk of becoming a victim of identity theft.

One of the ways to combat identity theft is to freeze your credit report.  It's effective in preventing a thief from opening an account or new line of credit in your name.  But credit freezes don't deter all instances of identity theft.

If you're worried about identity theft, then you might want to consider enrolling with a credit monitoring service.  These programs will monitor your credit report, and will notify you when a change or inquiry is made to your report.  These services can include locking or unlocking your credit report, automated notifications, as well as access to your credit scores.