Mend Your Finances By Opting For Credit Counseling Services

Opting For Credit Counseling Services

Credit counseling services are ten a penny, and some are downright frauds, but for every fraudulent company, there is going to be a service that does indeed help the average consumer. Spending over budget is probably one of the most common problems that plagues the average American, and neglecting to pay your bills on time can negatively impact your credit score. A poor credit score prevents you from getting approved for loans or renting the home of your dreams.

However, before things get out of hand and reach the point of no return, you could just employ the help of a credit counseling service. Though most services do charge a nominal fee for their help, the information and knowledge you gain in order to lead a better way of life is simply priceless. Even if your debt has reached an all-time high, credit counselors can help you get your life back on track and avoid filing for bankruptcy!

What Credit Counselors Can Do For You

As we just touched upon the topic of debt, credit counseling services can help you maintain good standing with your debt by paying it off or giving you the necessary warning you need when you’re starting to sink.

With the right counseling service, you can make sure that your credit score remains high in the 600s. A great score is an integral part of getting a loan with 0 percent interest rates. Additionally, when you look to rent pretty much anything, you need to have a decent credit score in order for companies and organizations to rent to you.

If you’re already in a world of debt and your phone is ringing off the hook because of creditors, you can finally experience a bit of peace when you sign with a credit counseling service. Your counselor is responsible for dealing with creditors and helping negotiate fair payments. Oftentimes, creditors will rip the average person off, but when you employ professional help, they know exactly how to get those pesky callers off your back.

Even if you’re not in dire need of a credit counseling service, you can still stand to gain something in the way of reduced interest rates. In most cases, yearly interest rates for credit cards can reach anywhere from 5 to 10 percent respectively, which is extremely high. A counselor can help you use your credit card in a manner that will not raise your interest rates, but lower them instead.

Bill consolidation is yet another good reason to hire a counselor. Credit counselors are able to help you mash all of your bills and debts into one lump sum that you need to pay off on a monthly basis. This can help you calculate your budget much more efficiently and know exactly how and when you will spend your money.

As you can see, there are quite a few reasons to get credit counseling help! With a high credit score, you will enjoy more perks in life.

The Benefits Of Credit Counseling

Credit Counseling

When individuals would like to pull in the reins on their rising debt and familiarize themselves with the dangers of piling on too much unnecessary debt, a credit counseling organization can offer them the assistance and guidance that they need to get their finances back on track. This is achieved through education and counseling.

The FTA states that a credit counseling company that is reputable is one who advises clients on debt and money management, teaches them how to develop a budget, and offers educational workshops and material for free. All of these tools help to fix one’s financial issues. The benefits of this type of counseling are noted below.

Achieve A Great Credit Score

Credit scores are at the center of most lending decisions. Therefore, if you would like to buy a car, rent an apartment, or obtain a mortgage for a house, your credit score needs to be satisfactory. If it’s not, your loan may be denied, or you may be forced to pay extremely high interest rates. Credit counseling services can help you get your credit score to a satisfactory number.

Create A Repayment Plan

Another benefit that credit counseling services provide is they can help you create a repayment plan with your creditors that you are in debt to. This debt management plan typically includes assisting you with reducing your payments and making payback easier with a interest rate that is systematic.

Reduce Interest Fees

A third benefit of seeking the assistance of a credit counselor is the fact that they can help you reduce the interest fee charges on your credit card accounts.  Acquiring credit card debt is a top way that individuals find themselves waist deep in debt. If you are able to get the interest fees on these credit cards reduced, you will be able to pay off the debt a lot quicker.

Consolidate Bills Into One

Are you the type of person who has multiple past due accounts with excessive interest rates? Well, another benefit of credit counseling is that your counselor can help you consolidate those accounts into one bill. You will have only one monthly payment, as opposed to multiple payments. This makes paying off your bills much simpler, and you will be less likely to miss a payment.

Get Rid Of Harassment

When you owe lenders money, debt collection calls become the norm at your household. They may call at all hours, multiple times a day, every day. This can become a nuisance after a while. One solution to stop these calls is to settle the debt that is owed.  Another solution is to seek the help of a credit counselor. They can broker a deal directly with the bill collectors and put an end to the annoying calls that you receive.

Get New Credit

When your application for a new loan has been rejected, you can seek the assistance of a credit counselor to give it another try. The counselor will negotiate a deal with the credit lender in order to get your previously denied application approved.

In conclusion, credit counseling can be very helpful. This is true regardless of your financial goals.

The Key to Managing Multiple Debts and Loans

Debts and Loans

Moving forward in life involves a drastic stretch sometimes, especially when it comes to money. Loans are a good way of getting through major payments—like mortgages, school tuition, automobiles—instantly, with the option of paying the debt off little by little over a certain amount of time. The price, it seems, to pay something off in one transaction is to worry about the debt that it will put you under for the coming months.

Combining Commitments

Realistically, your necessities may put you under more than one loan. Asides from car loans, student loans, credit card debts, there are also debts that may not be tied to an asset. With this much on anyone’s plate, the due dates, penalties and interests will get mixed up, causing even further financial harm.

Debt consolidation is a good way to rectify that situation. How does it work? Imagine having a stick for each of your loans or debts, having different lengths and different forms. Now imagine taking all of those sticks and combining them into one stick.

Consolidating your debt means to take out one big loan to pay off all or some of your existing ones, such that at the end of the day you only have one set of terms and conditions and one due date to mind.

Reconsidering and Refocusing

Before knowing if debt consolidation is the better option for you, consider first its upshots:

• Reducing the interest of all your existing loan’s interests combined

• Lowering the interest rate

• Extending or lengthening the loan term

• Convenience of having only a one monthly payment

It may take you longer to pay off that single debt because it’s a rather large amount, but having only one debt to worry about will enable you to refocus on other financial priorities, like saving and spending.

Of course, the terms of agreement may vary from one institution to another, so before combining your commitments, make sure to know your income and expenses and other factors that may affect the success of your consolidation.