Control your debts

Sue BeckumIf you’re like most Canadians, you have one form of credit card debt or another. Canadians are generally responsible borrowers and are invested in paying back their loans. Unfortunately, anyone can also fall behind in paying back their debtors. Loss of employment, medical illness or other emergencies can lead you to fall behind in your payments credit card relief an help, regardless of your best intentions.

Having unpaid credit card debt on your credit file can be detrimental for several reasons loans can help. One, it can seriously affect your credit rating, making it much more difficult to obtain a debt relief loan or any form of credit in the future. Two, you may end up with creditors calling you daily credit relief can help, leaving you feeling backed into a corner. And finally, credit scores are often obtained by potential employers to gauge your employability debt relief can help. Your credit score is often seen as a measure of your responsibility, ability to manage money and conscientiousness.

Fortunately, you can manage your debt more efficiently with debt consolidation. With debt consolidation, you merge all of your debt into one single sum. The credit card relief company that provides you with the credit card consolidation loan pays all of your debt, leaving you with just one debt left to pay. This is helpful to you because: it can help you keep an intact credit score and get debtors to stop calling your home, your work, even when you don’t want to take any calls.

There are dozens of credit relief agencies in Canada. Doing your research on each of them and reading any possible reviews online is advisable. Unfortunately, not every debt relief company may fit your specific needs.

The advantages of debt consolidation programs

Ben FranklandDebt consolidation is a financial strategy used when one takes a new loan to clear debts, usually at an interest rate that is lower than that of the loans or any other debts currently held. The strategy is usually considered viable by people who have huge debts.

The procedure involves taking out a new loan and using the proceeds from the new loan to clear off all debts. While it may have drawbacks, the method also has a number of valuable benefits including the following:

Single debt repayment

Under the debt consolidation program, all debts are consolidated into a single debt. The debtor only makes a single debt payment to the consolidating company, which divides the payments to every single creditor. The debtor doesn’t have to pay each creditor separately at different interest rates.

Improved credit score

Credit score is normally affected by late submission of payments or total failure to pay as required. With the consolidation program, however, the credit score begins improving as soon as the payment begins. Upon full payment of the debt, the consolidation company negotiates on behalf of the client, to ensure a favorable credit history.

Free advice and counseling on financial issues

For clients who enroll for the debt payment program, free counseling and advice is offered by the company. Debt consultants offer advice on financial plans, tips, and analysis of the options available for achieving financial freedom.

Protection from harassment by creditors

Customers who enter into contracts with the debt consolidation companies do enjoy protection from harassment by their creditors. Under the power of an attorney, the transactions are negotiated on behalf of the debtors and the creditor has no direct link with the debtor.

Lower interest rates

Debt consolidation loans are usually offered at interest rates which are lower than that of the debt for which consolidation is to be made. Companies negotiate the interest rates with the creditors and restructure the payment terms to make payment affordable, flexible and manageable.

Reduction of penalties

Within the program, penalty for default or late payment of debt is usually eliminated or reduced to a minimum. Interest accrual is also kept to a minimum level.

Faster relief from debt

The loan can be secured within a matter of hours or just a few months if well executed. This makes the debt payment process faster as compared to other conventional loans that may require accumulation of a lump sum of money or many years of payment in installments.

No special skills are required

In as much as professional negotiators act on behalf of the customer, a clear understanding of the entire transaction and credit procedure makes the process manageable if one wishes to manage it alone. Other debt payment programs such as filing of a bankruptcy request in a court of law may be complex and beyond self-execution.

Flexible terms and conditions

The program has friendly, flexible terms and conditions that enable customers to go as far as extending the period of payment to enable the payment of relatively lower installments.

With all the benefits that debt consolidation offers, it could be the most viable solution out of a debt crisis for an individual. A thorough investigation should, however, be conducted to understand any negative consequences of the program before settling for it as a solution for debt relief.