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Information if You Want to Consolidate for a Second Time

How long do we have to wait before we can consolidate our debts for a second time?

Both myself and my wife consolidated our individual credit card debt before we were married several years ago. Now it looks like we are in over our heads again with the remaining debt from the furniture and the wedding. Is consolidating our combined debts going to hurt us worse than a bankruptcy? My sister in law said we might never be able to buy a house if we consolidate for a second time.

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Consolidating debts is not at all as bad as filing for bankruptcy. In fact, debt consolidation is an alternative to bankruptcy. One can buy a house even after a bankruptcy, but only if you take the necessary steps to fix your credit and wait for your credit to recover, so your sister in law's fears about you never being able to buy your house are unfounded.

Just so you are clear about debt consolidation options, I will explain few of the options for you. There are several possible solutions to your problem, depending on how old the debts are, your financial situation and how much money you can afford to allocate to your debts on a monthly basis.

Very quickly, if you want a free debt consultation with one of Bill's approved debt help partners, click here: Debt Relief Savings Quote.

One option to consider is a Consumer Credit Counseling Service, or CCCS. CCCS companies offer numerous services, such as financial counseling and budget planning, as well as Debt Management Plans (DMPs). In a DMP, the CCCS would arrange a new payment amount with each of your creditors, usually based on a reduced interest rate. You would then make a single monthly payment to the CCCS which would distribute the funds to your creditors, based on the new payment amounts. There are several drawbacks to CCCS, though. First, depending on your creditors, it may not be able to reduce your monthly payments enough to improve your financial situation. Second, it may have a negative impact on your ability to obtain a loan, so you may not wish to enter into a DMP if you anticipate any large purchases, such as home or an auto, in the near future. Third, the average DMP takes around five years to pay off your debts, so you must be willing and able to commit to a long-term repayment plan.

You may also want to consider the services offered by a reputable debt settlement firms. While I know that there are several fly-by-night debt settlement operations on the internet, there are also several very good operations that may be able to help you. Rather than making monthly payments to your creditors, these programs negotiate lump sum settlements with your creditors, frequently reducing your debts by 50% to 60% of your principal balances. These programs usually take only 2-3 years to complete, so this is a good option for many people to rid themselves of debt in a relatively speedy manner. In many cases they can also reduce your monthly payment toward your debt. There is one major drawback to debt settlement programs, though–they will significantly damage your credit while in the program and for at least a year or two afterwards. However, if you are currently unable to afford to pay your creditors, the hit to your credit may be worth the benefit of ridding yourself of credit card debt. If you are interested in re-exploring debt settlement as an option, I encourage you to visit the Bills.com Debt Help section, using the link I mentioned above. We can put you in contact with a pre-screened debt settlement firm that may be able to assist you.

If you are seeking this debt settlement solution, I've done some homework, and Freedom Debt Relief ( www.freedomdebtrelief.com ) appears to be a great option, if you are seeking debt resolution or negotiated debt settlement.

I've done some homework for you, and here are the facts:

1. Freedom Debt Relief is a member of the Better Business Bureau (www.bbb.org )

2. Freedom Deb Relief appears to be one of the largest debt resolution firms in the country.

3. The Founders of the Company are Stanford Business School with impressive backgrounds in the financial services industry.

4. One of the Founders of Freedom Debt Relief is on the Board of Directors of The Association of Settlement Companies (TASC)

5. They look solid and credible.

If you are interested in general in negotiated debt settlement, I can give you the following facts:

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 lots of money.

Depending on your income and the type and amount of debt, one of the options I have described above may be able to help you. I encourage you to explore the debt help section of Bills.com, to read more about these and other options available to you.

I hope the information provided helps you Find. Learn. Save.

Best,

Bill

www.bills.com/

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1 Comments

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  • DC
    Jan, 2010
    debt
    Do you make money out of this blog? just curious
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