Many people get apprehensive when they are thinking of going to a debt consolidator. Their mind is flushed with too many questions. Here are the answers for some common questions that cross your mind!
How do debt consolidators work?
It work on a simple principle of taking your loans from the different loan agents, combining them, and then reducing your payments until you have a single payment to make. This process may seem a little difficult, but it's really worthwhile. It will carry out a consolidation process and reduce your overall debt.
Will the it decide the interest rate according to the loan we have?
The interest rates decided by it depend on several factors: your loans, the amount you have to pay off, balance transfers and even the money you have in your account at the time. However most people who apply for debt consolidation, already have a bad credit history which automatically makes consolidators assign them higher interest rates.
How do I qualify for a debt consolidation loan?
Most of the debtors who have a loan can apply for consolidation as soon as possible. Nevertheless, if you have a really poor credit history, you will not be eligible for a debt consolidation loan. Additionally, if you have a secured loan, you will not be eligible for debt consolidation as these types of loans cannot be added into the debt consolidation process.
Are all debt consolidation loans the same?
No, they are not! A few debt consolidators just carry out simple debt counseling and then combine all the debt under a single umbrella. You may not get a complete debt consolidation if the entire loan payments are not combined into a single payment with reduced interest rates.
How do consolidators decide the repayment period?
Most consolidators lower your loan payments and interest rates by lengthening your repayment time. That is not a good alternative at all as you will end up paying a larger amount to these debt consolidators over a longer period of time. Insist that your debt consolidator provide lower payments over a shorter period of time in order to get a good reduction on the amount of the loan.
Do I have any alternatives to using debt consolidators?
You can undergo debt consolidation by private carriers, credit and debt counseling, or through credit agencies that can reduce your loan payments. Remember to check through all your options before you actually commit to a certain consolidator.
Are debt consolidators, legitimate vendors?
Yes they are. However, there are unscrupulous dealers in nearly every trade. You may encounter consolidators that are not accredited. Make sure that you find a legitimate consolidator that is registered with the Better Business Bureau.
Is it possible for me to pay off the debt consolidation loans easily?
Yes it is. However, you will also have to make sure that you have managed your finances well to prevent financial problems from arising again.
Please follow the links to get more information on debt consolidators [http://www.0-debt.com/debit-consolidation/debt-consolidators/].
By: Sam Bundela Mohan
