Debt Counseling Help

It’s hard enough being in debt without having to worry about choosing the right debt help product. You do not need a finance degree to understand the different options. Here is a quick guide. Debt counseling agencies help you negotiate a payment schedule with your creditors. This can lower your monthly payments by spreading them out over a longer period of time. You usually have to pay a one-off enrollment fee to the agency, plus a monthly fee. This may be a good option if you do not qualify for a debt consolidation loan. Debt consolidation With debt consolidation, you take out a new loan to cover all of your smaller, high interest debts like credit cards and car payments. You use that money to settle the debts and are left with one monthly payment. The interest rate on the debt consolidation loan is lower than on the smaller debts, which means that you can pay it off sooner. The interest rate will depend on the amount you need to borrow, the duration of the loan and your credit history. Home equity loan If you own your home, you can use it to secure a home equity loan. With a home equity loan, your house is used as collateral. You can get this type of loan from a large bank or from a smaller lender. This is a good option if you need to borrow a large amount of money. However, if you do not keep up with repayments, the lender may foreclose on your home, leaving you with nowhere to live.