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Challenges with Debt Consolidation

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Consumers are assessing debt consolidation as a possible way to their problems from credit cards as well as other unsecured sources. The actual approach to consolidating debt needs to be, at least in theory, a fairly straightforward matter. You need to simply visit a lender and secure a loan at a decent rate of interest that’s large enough to settle your high interest Jason spencer student loan relief. However the process breaks down in actual practice, because lenders believe that these are risky loans and are not thinking about making them any more. They are scrutinizing loan applications like never before, an understandable reaction to the truth that they have so much toxic debt on their books due to the bursting of the housing bubble and the recession. The chances of actually qualifying for a debt consolidation loan at a good rate to resolve an unsecured debt problem are vanishingly low, unless of course you’ve a lot of equity in your home and are willing to take what most finance experts believe to be an unwise gamble by converting your unsecured debt into secured debt. If the debt were to remain unsecured then your only risk will be having your credit damaged, as opposed to the chance that getting behind in your payments could then instead cost you your home.Image result for student loan relief

You should think of getting access to the benefits of debt consolidation by dealing with a debt relief company rather than turning to a lender to get them. This statement may be surprising to you, but it really should not be when you finally understand a number of the facts that support it. Both debt settlement and credit counseling services utilize the advantages of debt consolidation in their processes, and are both offered through debt relief companies. Consumers are able to take advantage of making a consolidated payment at a lower interest rate, although the individual debts aren’t actually consolidated as is done with a loan. The debt relief companies act as the middlemen in the process, which makes this all possible. They distribute the correct portion of the payment to each of the creditors after accepting the monthly consolidated payment from the consumer. It certainly shouldn’t be assumed that blindly choosing either debt settlement or credit counseling will yield similar overall debt relief results, because there are big differences between both of these programs that must be considered.

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