How to Consolidate Loan Debt

You can use several methods to consolidate your loan debt. Some of the ways will help you to achieve your financial goals and objectives faster than others. The best way to proceed is to determine what you are trying to accomplish and then choose the method that saves you the most money in finance charges and also has the least amount of fees. Contact several banks or financial institutions to see which one is able to meet you needs and expectations.

Instructions

Debt Consolidation

1

Contact a credit card company and let the representative know you want to consolidate your debt. They will ask for balances and account numbers. If you are paying off credit cards, the address will appear on the representative's screen once you have given them the account number. You will need to give the representative the addresses for your other debts.

2

Tell the representative to send the payments directly to the creditors. The payments should be received in three to seven business days.

3

Use the equity in your home to consolidate your debt. Call a bank and apply for a home equity line of credit. After approval, you will be able to access the line of credit by going to your bank and filling out a withdrawal slip for the amount of money you need. You may also have the money transferred into your checking account then issue checks to your creditors.

4

Contact a debt management company like consumer credit counseling. You will pay them a lump sum each month and they will send the money directly to your creditors. The interest rate will be lower and your monthly payments will be lower. While you are in the plan, you cannot use or apply for any credit. The plan normally takes 36 to 60 months to complete.

5

Call your first mortgage holder and ask to have all of your debts consolidated. Depending on the term you may be able to receive a lower monthly payment and a lower rate. You can request your first mortgage holder to send checks right to your creditors.