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Debt consolidation is not just for consolidating credit card debt, there are other instances where debt consolidation can be favorable. Debt consolidation loans are available for those who are trying to make several payments a month, and allow them to combine all their payments into one, lower monthly payment, saving money at the same time as decreasing the debt level.

As stated above, credit cards can easily be combined into a debt consolidation loan. If you have several credit cards and store cards, making multiple monthly payments can become a huge hassle, not to mention that you are probably only making the minimum payment, it is also hard to keep track of where your money is going. By getting a debt consolidation loan for all of your credit cards and store cards, you will only be making one payment a month, making it easier to keep track of payments, decreasing your level of debt and seeing where your money is going more easily.

A debt consolidation loan can also come in handy when you have a couple of different car loans as well as a mortgage payment. By combining these loans into a single loan, it makes it easier to keep track of, as well as pay them down quicker.

The biggest temptation you need to avoid when you get a debt consolidation loan is racking up more debt. Once you see that you are getting ahead of your debt struggles, it’s easy to think you can handle using your credit card again or obtaining another one. It’s an extremely fine line to be able to use credit cards wisely and get into trouble with them, which is the reason for your debt consolidation in the first place. Once you have obtained a debt consolidation it is in your best interest to avoid using them anymore or just limit yourself to using them in emergencies.

Debt consolidation loans help to alleviate the pressure of trying to pay several bills each month, by allowing you to pay a single bill each month. It also helps to lower your level of debt each month, and you can see it happening, rather than not getting anywhere like you were prior to getting the debt consolidation loan. By combining your credit cards and loans into a single debt consolidation loan, you can more easily keep track of bills and see where your money is going and what difference it is making in your debt.

About the Author

Zack Fair writes for a Bad Credit Loans company Oops Home Loans, an Australian lending company offering debt consolidation, credit impaired inancing, home purchase and renovation.

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No House, Alot of Debt, What Do You Do?

If you have a great amount of debt, especially if it’s mostly from high interest credit cards or store accounts, you’d typically get a debt consolidation loan. This would give you one monthly payment instead of many different payments. Because the interest rate is much lower than the debts you’re paying off, the monthly payment is dramatically reduced. The reason the interest rate for a debt consolidation loan is so low is because it’s a secured loan. This means you have collateral, typically a home or other real estate, securing the loan. Because the lender has collateral for the loan, their risk is much lower and that is reflected in the interest rate.

So what if you’ve got no home or real estate to use for collateral? Can you still get a debt consolidation loan? Well, you may have several solutions. One debt consolidation solution for people who don’t own a home, but still have good credit, is to use no interest credit cards. Many people get these type of offers in the mail every week. You can transfer the balance from one or more credit cards onto a new credit card. For the promotional period, usually 6 months to 2 years, you’ll pay no interest on the transferred balance. That functions like a debt consolidation loan.

Make sure you cancel all or most of the old credit cards and examine your spending habits. This will help to keep you from getting into a dangerous credit situation. This can easily arise when you have the new card with a healthy balance that you transferred over, and all your old cards still active. If you start to accrue a balance on the old cards, you’ll soon find yourself in a situation where you have multiple cards with large balances in addition to the new card with the debt that you transferred. It’s worth mentioning again. Make sure you thoroughly examine your spending habits to ensure you don’t just spiral deeper into debt by adding a new credit card.

Another alternative, if you are really in a bind and don’t own a home, is credit counseling. Credit counseling can get you a debt management solution that can allow you to become debt free within a certain period of time. A good credit counselor will work with you to develop a personal financial plan that lets you maximize the use of you money. You can do more with your current income and get yourself out of debt. They will also look into the future to assist you in planning for the future, so you have a financial contingency plan in the event of an emergency. In a worst case scenario, they will work with creditors to negotiate different payment schedules or decreased credit balances.

If you need a debt reduction or consolidation solution but you don’t own a home, do not despair. There is a solution for your problems. You can get out of debt without sacrifice everything. You may need to increase a little, but you will come to an end, not a little.