If you're having debt problems in Tennessee and you're looking to plan your way out of it, then you should consider Tennessee debt consolidation or settlement. With debt consolidation, you'll have your multiple bills replaced with one monthly payment or you can negotiate your debt down with a settlement program.
Tennessee debt consolidation options
The following options can help you consolidate bills in Tennessee.
Get professional help:This is where you enroll with a consolidation company and let them negotiate lower interest rates with your creditors. This lowers your monthly payments. If you have incurred late fees or over-limit charges on credit card bills, they can be negotiated down or eliminated under a Tennessee debt consolidation program. Learn more...
Another way to consolidate your bills is to take out a low interest consolidation loan from a bank or private lender and pay your bills with a lump sum payment. The Tennessee consolidation loan then needs to be repaid in small monthly installments. Find out more...
Do it yourself:If you have multiple credit cards and you want to consolidate them into one, you can do so without getting help from a Tennessee debt consolidation company. All you need to do is transfer the balance on high interest cards to one having a low interest rate. The purpose is to reduce your monthly payments and replace multiple bills with a single installment every month.
Instead of transferring your card balances into an existing card, you can even take out a balance transfer card at 0% introductory period. Usually the introductory rate lasts for 6-12 months, so it is better to do a balance transfer only if you can pay down your debt within this time period. Therefore, you don't need to pay interest on your debt and your monthly payments are easily manageable.
Tricks and traps of Tennessee consolidation
Below are the tricks and traps of consolidating bills in Tennessee:
Tennessee debt consolidation loans
You may end up paying more:
Do not run up your credit card balance:
Do not deal with a company making big promises:
Review your monthly statements:
Be careful with balance transfers:
Tennessee debt settlement allows you to pay less than you owe
If you can't continue with your monthly payments and wish to get rid of your debt by paying less than you owe, debt settlement may be the right choice.
When you enroll with a Tennessee debt settlement company, they will ask you to make certain monthly payments to a savings account. After you save a certain amount, the settlement company will negotiate with your creditors or collection agencies (CAs) and offer to pay a certain percentage of the money you owe. The remaining amount will be forgiven by the creditor/CA. It is known as canceled debt that the IRS considers as taxable income.
Things to know before you settle debts with professional help
Here are a few things you should know before you enroll in a settlement program.
- Settlement fees: When you make monthly payments to the settlement company, make sure they don't keep a part of it before they deposit the money into the trust account. You need to verify the upfront fees, monthly fees, and other charges they need you to pay.
- Your credit will get hit if you stop paying creditors: When you don't pay your creditors and save money for a settlement, creditors report late payments on your credit report. This leads to late fees, high interest rates, and you may face legal actions such as judgments and garnishments. Most states now require debt settlement companies to not advise you to stop paying your debts in order to save for a settlement.