When you have credit card debt and are struggling to make your monthly payments, it might be time to consult a debt consolidation company. There are many non-profit entities that can work with you to create a budget, lower your current credit card payments and get you back on track to becoming debt-free. There are specific things that a debt consolidation company does to help you get out of financial distress and most companies are willing to provide a free consultation.
Provide Budgeting Tips
First, check with the Better Business Bureau to look for a company that has an excellent business rating, because there are some companies that charge high monthly fees for their services. Then, call a non-profit debt consolidation company to get advice on creating a budget. Credit counselors will go over your credit report, as well as review your monthly income and expenses. After reviewing everything with you, they can help you decide if a debt consolidation program will help your financial situation. They may also offer free workshops and educational materials on debt management.
Enroll You Into A Debt Consolidation Program
Decide if you want to consolidate your unsecured debt by enrolling into their debt consolidation program to lower your monthly payments. Once it has been determined that the program can save you money and interest, the company will work with you to get back on your feet and save money. You will be required to close all of your credit card accounts and sign documents showing that you have given the debt consolidation company permission to act on your behalf regarding your current accounts with the creditors. Have up-to-date statements on hand with your current balances in case they need copies.
Get Your Rates Reduced
Make your minimum monthly payments to your lenders until the debt consolidation company has gotten an approval from them. Each creditor will be notified that you are enrolling into a debt program by the consolidation company. The company will then work with the creditors to reduce your rates while you are in the program.
Monthly Payments
Send one monthly check to the debt consolidation company so they can pay all of your creditors in the program. Make sure you use a non-profit debt consolidation company to avoid paying high fees. Typically, you should pay less than $50 a month directly to a debt consolidation company for its assistance.
Monitor Your Accounts
Review your credit card statements each month and contact the debt consolidation company if your rates do not match the ones in your program. They will then contact your creditors to fix any issues that may arise. Plus, if you miss a payment and your rates so go up, they may be able to get you back on the program or counsel you regarding other possible solutions. Regardless the debt consolidation company will help you to pay off all of your credit card accounts within three to five years and help you become debt-free.
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