Article provided by: umbrelladebtrelief.com
Debt can take a heavy toll on your finances, especially when most of your income is going to loan payments. Fortunately, there are different methods through which you can minimize the negative impact your debts are having on your finances.
UmbrellaDebt is a debt relief company that offers consumers options on how to pay off their debts. If you are looking for a debt consolidation company, we are here for you. We have helped thousands of Americans settle their debts, and we can advise you if it’s the best option for you too.
Debt consolidation means getting a new loan to pay out other smaller debts, bills, or loans that you're making payments on. Since this is combining multiple debts into one loan, it is considered as 'consolidating' them. When you have several debts, you pay for various interest rates, make different payments, and deal with several due dates. With a consolidated debt, however, you only have one interest rate to worry about, one monthly payment to make, and a single due date.
The main aim of consolidating debt is to help you manage your debts and even pay them off faster. Another option that you can consider for reducing your debt is a settlement.
What’s the Difference Between Debt Consolidation and Debt Settlement?
While debt consolidation brings multiple debts together, debt settlement seeks to help you pay a much lower amount than what you owe your creditor. Debt settlement is beneficial when you if your account is already in collections or long delinquent. With debt settlement, you have little to lose since your credit score is already damaged.
Debt consolidation is applicable when you can still make your payments but wish to pay less on the interest rates.
Basically, debt settlement will help you reduce the amount you owe your creditors. Consolidation, on the other hand, will reduce the number of creditors you owe.
Should You Settle Your Debt or Get a Consolidation Loan?
The decision to settle your debt or get a consolidation loan will depend on the following:
- Your ability to pay off your debts
- The amount of debt you have
- How much interest you’re paying
When you have been unable to meet the payment conditions for your debts, settling your debt may be the best option. But if you’re servicing multiple loans and you want to get a lower interest rate or reduce the number of loans you are trying to juggle, consolidation is the way to go.
During a consultation at UmbrellaDebt, we will review and give you advice with no obligation.
Get Your Finances Back on Track
Perhaps you’re wondering whether debt settlement really works? If you feel helpless in your financial situation and do not want to declare bankruptcy, then debt settlement is a short-term answer. But if you were to weigh the pros of debt management against debt settlement, the better option is debt management. That said, finding a reputable debt consolidation company is the first step towards getting your finances back on track. Call us today on 1-844-386-3533 for a free phone consultation with our debt experts.
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