How do I Know if Debt Consolidation is The Right Option for Me?

How do I Know if Debt Consolidation is The Right Option for Me?

Debt management can mean different things for different consumers based on their specific financial challenges and goals. For many, debt consolidation is an excellent way to simplify monthly payments, save more money, and get out of debt faster.

Simply stated, debt consolidation involves combining all of your separate debts into a single amount owed. Instead of making separate monthly payments to your various creditors, you can make just one monthly payment through your debt consolidation company. For many consumers, it is a fantastic way to simplify and streamline the process of paying down debt. It can also help you avoid higher interest rates, saving you money in the long run, and it can reduce your monthly payments.

Nonetheless, it is not the right option for everyone, so it is important to consider your financial history and your debt relief goals before choosing a course. And while there’s no easy answer as to whether debt consolidation is right for you, generally, if you have good credit and the ability to keep making timely payments, you may qualify for a debt consolidation loan. On the other hand, if you have a large amount of high-interest credit card debt but you consistently struggle to find the money to cover your payments each month, you may want to consider debt settlement as an option instead.

Here are some signs that debt consolidation may be the best debt relief option for you.

You’re having trouble tracking your monthly payments

If you’re frequently late – or you risk being late – making monthly payments to your creditors, debt consolidation can help you streamline this process by combining your debts into one single loan. That way, you have much less to keep track of, which means you are far less likely to skip a payment and set yourself back in your payoff goals.

You’re juggling multiple credit cards and payment schedules

If you’re dealing with multiple high-interest cards, payments, and due dates, consolidating your debt can make your life, and your financial obligations, much easier to manage. By rolling all of your debts into a single monthly payment with just one interest rate, you can more easily make your payments, track your debt principal and interest, and monitor your payoff progress as you watch the balance decrease.

Your existing loans have variable interest rates

While most debt consolidation loans carry higher interest rates, they are fixed. Conversely, many high-interest credit cards have variable rates, meaning they can change over the life of the loan. This makes it difficult to budget for the future, as you don’t necessarily know what your exact payment amounts will be. Consolidation loans can help you solidify a feasible budget since you know that your interest rates won’t change and as such, you can keep your monthly payment amounts predictable.

Your credit history is strong

Lenders pay attention to your credit history as well as your timeliness in making your monthly payments. If you have a history of making your payments on time, and your credit history is decent, you are much more likely to qualify for a debt consolidation loan since lenders will see that you are a reliable, responsible borrower.

Here at Countrywide Debt Relief, we have more than three decades of collective experience helping consumers like you become debt-free using options like debt consolidation. If you think you could benefit from exploring this option, or you’d like to learn how we can help you find financial freedom, we welcome you to contact us for a consultation.