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Reasons that make debt consolidation preferable for the debtors

Are you someone who has incurred above $10,000 on your multiple credit cards? Are you getting dunning notices from your creditors who are asking you for immediate repayment and threatening you about serious consequences? If answered yes, you need not worry as there are debt consolidation firms through which you can get back on the right financial track and start afresh. Debt consolidation is one of the most common financial tools that are taken into account by the debtors who are going through dire financial straits. You can learn more here about debt consolidation companies.

  • They will assess your finances: The debt consultant who is in charge of the debt consolidation companies will assess your finances in order to check the current financial state that you?re going through. They will take into account the principal amount that you?re paying, the interest rates that you?re paying on each account and the total amount of money that you make in a month. They will also consider the other obligations that you have to meet throughout the month apart from the credit card debt obligations.
  • They will negotiate with your creditors: The debt consultant will negotiate with your creditors and tell them about the hardship that you?re going through. It is most often seen that the debtors hesitate from getting in touch with the creditors as they?re sure that they won?t help them in any way. But this is a wrong notion and you can easily be able to let the debt consultant negotiate with your creditors on your behalf.
  • They will convince creditors: The debt consultant of the debt consolidation company will also convince the creditors about lowering the interest rates on your debt account. You just have to give them the details of your debt accounts so that they can get in touch with each one of them and thereby help you facilitate the debt repayment schedule. The creditors will check your financial hardship and can even lower the rates on your cards.
  • Single monthly payments: Instead of making multiple payments to all your creditors, you just have to make a single monthly payment towards the debt consolidation company. The debt consultant will accept all your payments and in return he will disburse them off to your creditors so as to help you become debt free within a short span of time.
  • Boosts your credit score: You can even boost your credit score by consolidating your debts through the debt consolidation company. Just make sure you keep making the monthly payments on time lest you hurt your score in a bad way.

Therefore, when you?re wondering about the ways in which debt consolidation can help you, you should consider the above mentioned reasons before choosing one.

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Interest-free periods don't apply unless you pay off in full. To avoid paying interest on your credit purchases you must pay the full outstanding balance on your statement (not just the minimum payment required) by the due date. If you don't, you will be charged interest right back to the date of purchase on each item thus forfeiting the interest-free period on those PAST purchases. What's worse, you must pay the balance off in full before you will get any interest-free period on CURRENT and FUTURE purchases.

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