Posts from — October 2010

The piling debts are one of the serious problems that need immediate attention in order to achieve financial freedom. The economical issues related to debt might have overburdened your life that might be causing sleepless nights. In this situation debt consolidation services can help you to get out of this debt problem.

What is Debt consolidation?
Through a single payment you can pay down your multiple debt obligations with the process of debt consolidation. The high interest loans are replaced with lower monthly payments by consolidating under one larger loan.
If you are looking for a convenient way out of debts then you can consider this program. The sole reason for taking up debt consolidation services is that it does not put at stake any personal assets like car or home and has a negligible effect on your the credit score.
If you are planning to file bankruptcy as you are neck deep in debt then reconsider your options in order to free yourself from the clutches of debt. Debt consolidation process can give you easy solution if your financial situation has not yet worsened. It will not only repair your credit score but also prevent the creditors from harassing you.
This article would show few positive as well as negative aspect of debt consolidation that would help you to decide whether this program would be ideal for you or not.

Pros and cons of debt consolidation program:

1. Single loan with one creditor:
One of the greatest advantages of debt consolidation is that you need to pay to a single creditor than making payments to several different creditors for the amount you owe. As you don’t need to remember various due dates therefore the repayment plan is quite smooth and in this way you can avoid late payments. Making payment to a single creditor reduces your hassle of dealing with various collectors at one time. In this way you can save yourself from creditor harassment for instance getting abusive calls at work place or home and demanding for payments at odd hours.

2. Monthly Payment is low:
Another advantage of debt consolidation program is that it lowers the monthly payment. This program is budget friendly as well as makes the payment plan affordable for your pocket. A debt-consolidation company can prove to be beneficial as it offers you loan at lower interest rate compared to your current creditors.

3. Payment Period is prolonged:
One of the prominent cons of debt consolidation is that your payment plan gets prolonged as you are merging all of your debts into a single debt. You might require longer time to pay off your debts as the consolidation company would grant you lower payment with a low interest rate. The total amount of interest would increase as you repayment plan would be prolonged that can create impediment while paying off you consolidation loan.

4. Adverse effect on credit score:
Debt consolidation might have a negative impact on your credit score. As 10% of your FICO score depends on the average age of your accounts. There might be significant drop in the score with the opening of a new account as that might lower the average age.
The creditors would inquire if you apply for a consolidation loan or transfer your balance to a new account. Another 10% of your score is determined by the frequent number of analysis of your report therefore your score would be lowered with the increasing inquiries.

5. Limitations of debt consolidation companies:
Debt consolidation companies might have limitations at times this is also a disadvantage of these companies. The creditors might refuse to work with debt-consolidation companies therefore these companies would fail to consolidate all of your debts and give you financial freedom.

This article has been written by Angela Sanders. She is a content writer for  Oak View Law Group, a trustworthy debt settlement firm.

Whenever the economy is bad, getting worse or has hit rock-bottom, there is usually pandemonium, the press goes to town writing and saying all they can about how bad things are and how it is bound to get worse. However, there is always that silent voice, almost like the voice of reason whispering the word: COMMON SENSE!

Below are 2 important tips or tricks (since not many people do them) that one should apply in the days of financial and economic trouble.

1. Press Re-set Button

Any of us who has used a modern electronic gozmo before knows what this button is. It is the rescue spot when your gadget freezes. Some computers also have it. To do this to yourself in real life is indeed one of the fundamentals of surviving hard economic realities. The practical way to press reset button is as follows:

• Re-evaluate your spending. Are you spending first on what really matters? Toothpaste, toothbrush,shelter not unnecessary luxury in a penthouse. Gas guzzler automobile versus biking/small fuel efficient scooter.
• Re-assess your income. Do you refuse to work overtime and get the pay? Are you giving far too much of your services away for free. Are you getting paid for the knowledge you give away everyday or are you giving it away for free as free advice?
• Re-define your saving plans. Initially after college you wanted to spend wildly for 5 years before settling down. Now you should re-consider and start saving now. The savings you put aside now could save you when your employer suddenly lets their best employee of the year go….and it was you!

2. Seek new Knowledge

For the recent college or grad school graduate, this sure would taste like sand in the mouth. However, the reality is that many people end up earning a living from a skill very different from what they have been studying for years. With digital technology exploding over and over daily, access to knowledge is no longer a tenable excuse

• For visual monsters who love movies and TVs, hook your high-speed internet onto a TV monitor and consume the gazillion number of how-to videos online.  Start at Youtube.com, look for youtube.edu or simply google the topic of interest  (+) video. You may soon fin=d out how this skill can earn you extra money.
• For the rest, devour websites that have information that you are interested in. Seashells, cart wheels, dentures or any other topic. You are increasing your knowledge-base and in a knowledge-driven economy, this is a trump card.
• If you are more advanced, look for some youngsters to teach. teach them for free or for a fee. Volunteer to teach a young lad, volunteer at the local church. Teach teach teach. Giving to society is sure one way of tapping its resources.

I hope we can start applying these tips and tricks in our daily lives. If you have other tips and tricks that have worked for you, let us hear them in the comments below.