When you're struggling with mounting credit card debts, you may consolidate them into a single monthly payment. That'll make your repayments easier and get you out of debt faster. But before you consolidate bills, check out the 13 faq given here and get answers to the queries you may have on credit card consolidation.
You need to contact a consolidation company. They'll arrange for a free debt counseling session where a consultant will analyze your financial situation and help you to find out whether you qualify for credit card consolidation.
Consolidation offers the following benefits:
Yes, creditors and collection agency will stop harassing you provided you keep up with the monthly payments while you're on credit card consolidation.
Yes. Creditors may not file a lawsuit or seek a judgment order while you're consolidating credit cards. This is because the consolidation program or loan will help you to meet your monthly payments so that you can avoid a default on your accounts.
The duration of a consolidation program depends upon the number of cards you have and the total amount you owe. Usually, it lasts for a period of 4-6 years. A debt consolidation loan takes quite a long time to get you out of debt.
It is better if you don't use credit card accounts while you're on a consolidation program. This is because it will add to your dues thereby making it difficult for you to keep up with monthly payments under the program.
Yes, your creditors will send you monthly statements while you continue making payments to the consolidation company which negotiates on your behalf.
If your financial situation improves, let the consolidation company know about it. They'll talk to your creditors and increase your monthly payments so that you'll get out of debt faster. Similarly, if circumstances are not in your favor, you can talk to the company and have your monthly payment reduced so that you can afford it.
Yes, you can send extra payments to the consolidation company. You need to inform them about the debt account towards which you're paying extra. They'll distribute the extra funds to the respective creditors.
If you miss a payment while you're on credit card consolidation, contact the representative at the consolidation company. He will contact your creditors or collection agency and work with them so as to lower your payments and make them affordable for you.
You don't need to be a homeowner in order to qualify for a consolidation loan. Apart from a mortgage (secured debt consolidation loan), there are personal loans available for consolidating credit cards. If you have good credit, you can easily qualify for a personal debt consolidation loan, which doesn't need you to keep your home as the collateral.
Since consolidation helps you to make payments that you can afford, therefore, it doesn't hurt your credit. Rather, it'll have a positive impact on your credit.
Yes, you can leave a consolidation program if it doesn't work for you. Once you're out of the program, you'll have to make specific arrangements with your creditors in order to pay off your bills. Otherwise, late payment fees/interest charges will be added to your account again and creditors may start harassing you with frequent calls.
|
|
