Consolidation Loans For Bad Credit

If you have thousands of dollars in credit card debt, like many North Americans you are probably paying a very high interest rate just to stay even and pay those "minimum payments". A good option in many cases is to avoid filing bankruptcy and consolidate your debt. If you have $15,000 dollars on your credit cards right now, you may be paying as much as 20% interest per year. That is close to $300 dollars per month and you are not even paying off your debt. You are just maintaining... If you consolidate your debt into one, low monthly payment, you can probably trim that down to $100 dollars per month, or even less. In other words, you can become debt free faster. (Or, if you want you can buy more stuff, but I would not recommend that. )

Credit reports often have incorrect items on them. A credit repair company can help fix these items so you get the loans you want without paying higher interest rates reserved for those with low FICO. You can also do it yourself with a credit repair kit, or a simple letter to the credit bureaus. However, doing it yourself takes a lot of time, so you must decide how much your time is worth and do a cost-benefit analysis. If it takes you 10 hours to fix your credit report, and a law firm charges you 40 dollars to do the same thing, it might be worth it. The only way to know for sure is to investigate your options.

Maintaining large credit balances can be very expensive. For example, if you have a current balance of $20,000, with 19.5% interest and a small monthly payment, it would take over 10 years to pay it off and would cost you an additional $20,000+ just for the interest, which almost doubles the total cost of whatever you bought. But if you consolidate your credit card balances, you can cut this down significantly AND pay off the loan in a much shorter time. It might take some discipline, but life does get better with the help of a non-profit credit counselor's help.

Debt collectors can call you at home and even at work (so long as you have not told them to stop calling you at work) until you pay back your loans. You can, however, write them a letter to make them stop calling. This does not take care of the underlying problem, but it can stop them from harassing you. It is consolidation loans for bad credit. And, there are many unscrupulous collectors who ignore the Fair Debt Collection laws and still call. Debt consolidation can take of this too without your creditor being able to deny knowledge of having received a letter.

For more information on Fair Debt Collection laws, visit Fair Debt Collection at the FTC's web site.