Debt Consolidation - New York
In New York and other states, many residents experience anxiety and hopelessness due to overwhelming credit card debts caused by unemployment, rising cost of living, or unexpected personal emergencies and seek relief such as debt consolidation. If you are also struggling with credit card debts and feel like you are going nowhere with your minimum monthly payments, then you might be interested in finding out how consolidating your debts can potentially lead to savings.
Debt consolidation, or a debt management plan (DMP), is a popular debt relief method that allows you to take all your high-interest credit card debts and unsecured debts (such as medical bills, store cards, or utilities) and combine them into one, more structured, and more manageable monthly payment made to a credit counseling agency. While consolidating debts may be a wise move for some consumers, it is not the only debt relief option available. Some may find that debt settlement or even debt consolidation loans are preferable options as well. If you want to explore how debt relief can help you manage and pay down your debts, get a free debt relief estimate and savings analysis - it only takes minutes!
Debt Consolidation: Just the Facts
In this tight economy, credit card debt has certainly become an unfortunate part of life that simply won't just go away...unless one takes the proper steps to resolve it. If you are also looking for a viable way to reduce your debts, you may be interested in how debt consolidation works.
Facilitated by credit counselors, debt consolidation typically begins with an assessment of your financial situation - taking into account your income, debts, and other assets/property. When they have a clear picture of where you stand in terms of your debts, credit counselors will typically develop a game plan and contact your creditors to submit proposals - proposals that may include reduced interest rates and the waiving of late fees and penalties.
Creditors that accept the proposals become part of the debt management plan. Credit counseling agencies, in turn, distribute those funds to creditors that are in the plan. With a more structured and more affordable payment plan in place, you can, ideally, reduce your debts sooner than if you continued to pay only the minimum monthly payment on your credit card bills at higher interest rates.
That's why it makes sense to find out how debt consolidation could potentially help you manage your debts or possibly even lead to savings every month. Get a free debt relief analysis and savings estimate here - to start.
Debt Consolidation vs. Personal Loans
These days, many consumers in New York may apply for debt consolidation loans to help pay off their credit card debts and other types of unsecured debts that they have accumulated over time. What they are essentially hoping to do is to combine their high-interest credit card and unsecured debts into one, lower interest personal loan. While personal loans may work for disciplined debtors, it is worth noting the potential risks:
A debt consolidation loan typically involves taking unsecured debt and paying it off with funds that come by way of a "secured" loan. Thus, it is generally a loan where you would have typically put up your home or other property as collateral. If you struggle to make your loan payment, you would have essentially put your home at risk. Another risk: In many cases, consumers who get a debt consolidation loan generally end up using their credit cards again and start ringing up new, high-interest charges. In this scenario, many of them will have new, high-interest credit card debts to deal with on top of their loan - a scenario that one may consider going from "bad to worse."
In comparing debt consolidation to debt consolidation loans, debt consolidation may be preferable for consumers who want a simplified and more predictable path out of debt, which if followed faithfully, can help them pay down debts at an accelerated rate. If you are ready to take the next step in putting an end to your debt crisis and start managing your debts, request a free debt relief estimate and savings analysis - at simply no cost to you.