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Consolidate? Oustanding debt affecting my loan eligibility.

Date: Wed, 01/11/2006 - 15:37

Submitted by anonymous
on Wed, 01/11/2006 - 15:37

Posts: 202330 Credits: [Donate]

Total Replies: 5


Hi folks. I've read through several posts and I've seen some very helpful responses. I was wondering if someone might share some good 3rd party advice for me.

I have several oustanding debts (haven't paid in 90+ days due to layoffs and no income) that have gone to collection agencies. They add up to around $4200. I have $3000 that I owe my university's Bursar Office for a semester I stayed in the dorms. Finally, I have an unsecured loan at my bank for $6500 that I am also 90+ days deliquent in.

I've read on several websites (by searching for credit counseling services) about the company being an intermediate for current credit cards and credit collectors, negotiating lower payments and lower interest rates.

This is NOT the route I'd like to go. I'd prefer to have a consolidation LOAN where those 6-7 collection agencies are paid off, and my credit score will report them as "Current" or "Closed" instead of "Oustanding". I don't mind at this time paying a higher interest rate to one source, if the collection agencies are paid.

Is this even possible? My FICO is somewhere around 494. Possibly lower, since I'm sure those "outstanding" accounts continue to negatively affect my credit score.


Mitchell,

Welcome to forums :D

You are absolutely right. Outstanding debts and delinquent accounts are hurting your score badly and it demands immediate attention. Credit is an asset and you should be caring to it.

Now with your current situation, it would be difficult for you to get another loan. If some lenders agree to work with you, chances are they would ask for some collateral. Moreover you have a number of unpaid accounts already, so another loan might take you deep in debt.

IMHO, try a consolidation program. You can place all your unsecured debts in the plan. It will help you to repay all your accounts with easy and affordable monthly installments. debt consolidation has lots of benefits, look at the list of advantages here-

http://www.debtconsolidationcare.com/benefits.html

You can register with this site to avail free counseling with professionals. This would help you understand your options better. The consultant will negotiate with your creditors and try to settle the debts at a lower amount. He will also insist your creditors to report your accounts in your favor as you have mentioned in your post. See how debt consolidation helps to clean your credit file-

http://forums.debtcc.com/forums/consol-result.html

Hope this helps. Feel free to ask your queries in the forums.


lrhall41

Submitted by 4u.bryan on Wed, 01/11/2006 - 16:41

( Posts: 819 | Credits: )


Does this service include Debt collection agencies? I'm concerned with having no "outstanding" debts on my credit score.

Even though I have a decent income for my age, I can't afford to not be able to get a loan for a 3-5 years, like the first link suggests.

The second link says that "It is the responsibility of the debt consolidation company to make regular payments to your creditors." - If I have a $3500 collection, and a $80 collection, will both of those be spread out across the 3-5 years? It would make sense for them to pay those first/ASAP to help the credit score/report.


lrhall41

Submitted by on Wed, 01/11/2006 - 17:09

( Posts: | Credits: )


Mitchell,

Consolidation program will cover all the unsecured debts that you owe. You can include as many accounts as you wish. It might be with collection agency or with original creditor that does not matter actually.

Quote:

If I have a $3500 collection, and a $80 collection, will both of those be spread out across the 3-5 years? It would make sense for them to pay those first/ASAP to help the credit score/report.


The consultant who will be working in the program will design the plan in such a way that brings the ultimate benefit for you. Moreover you should also share all your views and comments with him, so that the best arrangement comes up. You will always be a part of this program and the consultant would definitely value your opinion.

If you still have any doubts, just review the feedback of one of the customers who is an active forum member now-

http://www.debtconsolidationcare.com/customer-service.html


lrhall41

Submitted by 4u.bryan on Wed, 01/11/2006 - 17:26

( Posts: 819 | Credits: )


Good points Bryan. It seems to be that some personal loans are a quick fix. I wish I would have entered debt consolidation years ago. You live and learn. It seems like it extends your payments out at a higher interest rate. I know I will be debt free in less than two years with all of my creditors now. I know I'm also improving my credit score in the long run.


lrhall41

Submitted by Cow & Chicken on Thu, 01/12/2006 - 20:03

( Posts: 3571 | Credits: )