Bad Credit Consolidation loan - The Bills.com Blog
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Bad Credit Consolidation loan
Question: I have bad credit and i want to know if i can get a loan to consolidate all my credit problems and just pay the loan, and also if you help bring the amount due to a lower rate.
Answer: I think what you are referring to are two different options. The first option is called a debt consolidation loan and the second one (bringing the amount due toa lower rate) is also known as debt settlement. I will explain both these options below.
If you want a free debt help quote to evaluate your options, click here:
Debt Relief Savings Quote
Debt Consolidation Loan:
Many people think first of a debt consolidation loan when seeking online debt consolidation. This option typically means a second home loan (or home equity line of credit) or refinancing your primary mortgage. In a debt consolidation loan, you exchange one loan for another. The most frequent form is taking out a mortgage loan, which carries a lower interest rate and is tax deductible, to pay off high interest rate credit card debt. It is important to be aware that shifting unsecured debt to
secured debt can create a volatile situation, if there is ever a chance that you cannot afford the new mortgage payment you are now putting yourself at risk of foreclosure! In the case of a debt consolidation loan, most mortgages are 30 year loan, which means that the total cost and the time to debt freedom could be very high… but the monthly payment will be lower than other options and there is no credit rating impact.
Debt Settlement:
Debt settlement, also called debt negotiation, is a form of online debt consolidation that cuts your total debt, sometimes over 50%, with lower monthly payments. Debt settlement programs typically run around three years. It is important to keep in mind, however, that during the life of your debt settlement program, you are NOT
paying your creditors. This means that a debt settlement solution of online debt consolidation will negatively impact your credit rating. Your credit rating will not be good, at a minimum, for the term of your debt settlement program. However, debt settlement is usually the fastest and cheapest way to debt freedom, with a low monthly payment, while avoiding Chapter 7 Bankruptcy. The trade-off here is a negative credit rating versus saving money.
If you need other debt help, please contact a counselor - we have several online at: https://www.bills.com/debthelp/debt
We hope that this helped you to Find, Learn, & Save!
Best,
Bill
www.bills.com
Also, make sure to get a free financial health check-up with Bills IQ!
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1. Posted by Denise Smith on Monday 12th May 2008 09:50
Dear Mr. Bill, can i qualify for a home equity loan if i have already refinanced my home loan with a different loan company from the original loan company My credit is not good and i am 2 months behind in my mortgage payment. I am self employed and i am having a hard time keeping up with all my expenses.
2. Posted by Bill on Monday 12th May 2008 10:19
Depends on how long ago you refinanced. Also, because you are behind on your payments, it might be a difficult proposition. But there is no harm in trying our lender match service available at: https://www.bills.com/homeloan/refinance_save/?rbc=blog Just fill in your information and you will be contacted by lenders who would be willing to work with you based on your information.