How Debt Consolidation can help fit Debt Repayment into Your Budget
<p data-sp-element=”content”>If you haven’t been making payments on your debt in a while, it can seem a little daunting to agree to take on the expense when you consolidate your debt. If you haven’t been able to come up with a way to afford your debt for a while, it’s only natural to wonder how you’ll be able to afford it now. Fortunately, because debt consolidation loans are designed to help people who are struggling with their debt, there are several ways that they address this issue.If you haven’t been able to make the full minimum payment on your debt in a while, debt consolidation is definitely the answer for you. These loans are designed to lower the minimum amount that you spend on your debt. For example, if you have to pay five different credit cards with a minimum payment of $25 each, combining your debts together, getting a lower interest rate, and stretching out the payments over a longer period of time can get your monthly payment down to $75 or less. You’ll pay less every month, enabling you to get your debt payment down to something you can afford. To make sure that this happens, your debt counselor will go through your budget with you and ensure that you have the means to pay off this debt.If you have large debts that you haven’t paid in a while, or even debts that you’ve never made a payment on, debt consolidation can also be a helpful tool. It’s very common to use a credit card or personal loan to pay for an emergency, such as an emergency medical procedure or out of town trip, then wonder after the disaster how you’re going to pay the bills. Fortunately, our debt counselors have a lot of experience in these situations.A debt counselor will go through your budget (or help you make one if you don’t have one) and find how much money you can devote to debt repayment. From there, they’ll look for a loan with a payment that you can afford, based on this analysis. Often, they’re able to fit in the new debt by lowering your interest rate on your other debts and stretching out the payments over a longer time. In other cases, they can suggest ways to save money that will free up some cash so that you can take care of your debt once and for all.