Want to pay all your bills with one check? Debt consolidation
may be the answer. It's not a loan or bankruptcy but a program,
run primarily by nonprofit organizations, that helps reduce
interest rates, eliminate late-payment fees and lower payments.
With consolidation plans, organizations such as Consumer Credit
Counseling Services and Myvesta.org arrange for you to pay off
your debts within three to five years, although it may vary
depending on your needs. That's a pretty attractive idea,
considering it takes the average person 10 to 20 years to make
credit balances disappear. However, participating in a
consolidation program could affect your ability to get new
credit or a loan because some creditors will put a red flag to
lenders on your credit report. Here's how the plan works:
1. After giving a program counselor the account names, numbers
and balances that you want to combine, she will help you work
out a budget and determine how much you can afford to pay toward
your debts.
2. The consolidator will then contact your creditors and work
out payment arrangements. (Most consolidators charge up to 15
percent of your monthly payment to cover program costs.)
3. You make a monthly payment directly to the consolidator, who
will pay the creditors on your behalf.
4. The accounts placed in the program are frozen until they are
paid in full. To learn more about debt consolidation, go to
http://www.1debtfreedom.com Talbert Williams offers debt
consolidation referrals and advice. For more information,
articles, news, tools and valuable resources on debt solutions,
visit this site: http://www.1debtfreedom.com
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