Debt consolidation is a very serious step.  It can be a good option if you are in a desperate situation, but make sure you get a lot of assistance before taking the leap.  Debt consolidation is combining multiple payments into one.  Usually a payment for a consolidated loan is less than for each of the other loans separately.  This can sometimes help you avoid bankruptcy or gives you extra money at the end of the month (which can be used to accelerate debt payoff).  Any form of debt can be consolidated (some easier than others).  It is most practical to consolidate unsecured lines of credit into a secure asset or personal loan.  Take note though that even with a lower interest rate, you will most likely be paying moreover the life of the loan simply because it will take longer to pay it off.

Debt consolidation assistance is only a short-term solution for a long term habit.  You will have to figure out what actually cause to you go into debt, take control of  your money & never let you get into this situation again.  In other words, debt consolidation assistance will only help you rid yourself of debt, it will not change your habits, you have to do that.

There are many different variables you have to look at when choosing a good company.  If you can get a recommendation from someone you trust who has already been through the program that is the best.  However, if you don’t have that luxury, be sure you talk to at least 3 different debt consolidation assistance companies.  Check them out with the Better Business Bureau & that they are following all federal laws (if it seems fishy, its probably not legal no matter what their explanation). 

Next do not let your emotions get the best of you!  It is a scary position to be so in debt that you can’t make your monthly bills, but you have to work through things logically or you drastically increase the chance of getting scammed. 

Don’t feel obligated to any one company because they spent some time with you.  They make plenty of money & are offering the FREE consultation.  Take advantage of the consultation to find out if they are really the right company for you.

When it comes time to sign paperwork, make sure you read EVERYTHING.  Do not sign a paper that you don’t understand.  If you have questions call the debt consolidation assistance company & they can explain things to you.  If they are not willing, or things just don’t seem right – DON”T SIGN!

You need to be really careful, remember people are scammed all the time by companies like these, so don’t feel bad about spending extra time or taking their time to make sure it is a good fit for you.

Hopefully this will get you started out on your search for debt consolidation assistance, but if you still have more questions & need more advice, check out our debt consolidation assistance blog.