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A Guide to Consumer Credit Counseling
when debt begins to build up uncontrollably, it may seem as though the only way for you to get out of debt is to file bankruptcy and deal with all of the negative repercussions that come with it. luckily, there is another option? in many cases a service known as consumer credit counseling can help you to avoid bankruptcy while eliminating your debt and getting you back to where you need to be in regards to your credit.
a variety of consumer credit counseling services have come into being within the past several years, and so long as they continue to provide services that help individuals avoid personal bankruptcy, it seems that there will be a need for these services for some time to come.
what is consumer credit counseling?
consumer credit counseling is a method for resolving the debts of an individual without filing for bankruptcy, using a third party to negotiate settlements with creditors and to assist in budgeting money for debt repayment. consumer credit counseling services dont issue loans or offer any sort of repayment themselves; they simply help you to manage your money so that you can repay your own debts, while at the same time working with your creditors in an attempt to get them to reduce the total amount that is owed. this allows you to pay a reduced amount, while it allows your creditors to avoid the additional expenses of collection attempts and possible court costs.
how do consumer credit counseling services work?
consumer credit counseling services operate in two ways... they are either non-profit organizations that operate off of government grants, or they are for-profit organizations and charge a nominal fee for their service. regardless of how they make money, the core of the service that is provided remains the same; negotiation with creditors (many of whom they already have contacts with) and assisting individuals in debt with their budgeting and repayment. depending upon the amount of money that is owed, some people can get through the credit counseling service rather quickly and have all of their debts reduced and repaid. others may find themselves taking several months or possibly a year or more to repay their debts, even after negotiations reduce the total amount owed.
the time spent doing so is usually worth it, however, as the individual who spends a year or more would likely have no other option aside from bankruptcy if they had not chosen credit counseling.
avoiding consumer credit counseling scams
as with most services concerning money, there are those who will try to present themselves as consumer credit counseling services in order to scam money out of individuals who are desperate for a way out of debt. these scams usually present themselves as offering instant debt relief or claim that they can cancel debts that you owe for a fee. what they usually offer, however, is a business tax id number to replace your personal id. the worst part of this is that it is usually legal for a business such as theirs to request a new tax id number, but should an individual use it in an attempt to gain personal credit they are subject to fines and possible criminal charges.
before signing up with any debt relief service, its important to check out their background and obtain references if possible? especially if they charge large fees for their services or claim to offer instant results.
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about the author
john mussi is the founder of direct online loans who help homeowners find the best available loans via the http://www.directonlineloans.co.uk website.
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Can I get Bad Credit and Unsecured Credit Cards?
regardless if you have good credit or bad credit or even if you are rich or poor, there is a credit card on the marketplace for you. if you have bad credit then you will need to find a company that offers unsecured credit cards. the secured credit cards are for families and individuals that have money, yet want a credit card to maintain their credit rates on the records. spending money is not going to build their credit, therefore they will use the cards to build there credit line. frequently these people will expend a couple of hundred each month and repay the charges off quickly. this is ludicrous since the repayments paid sooner than the date due will not build any credit lines. rather, the cardholder must show good faith by paying the cards off on the due date.
if you have bad credit, then be aware that providers that offer unsecured credit cards may require a small deposit. the deposit is a security to the lenders that if you fail to make payments, they can use the deposit to meet the debt amount. if you apply for the card and are approved, most likely you will not receive a credit line above the depositing amount. in other words, you credit card may only provide you $500 credit and if you exceed these amount you are at risk of loosing your card.
most unsecured credit cards offer low fixed interest rates and a credit line, starting at $200 and up, depending on the card provider and the depositing amount. the providers may even offer additional benefits, including cash back or points per purchase made on the credit card. you will need to be very cautious while looking for an unsecured credit card.
the pesky sales peoplesalespeople will often go out of their way to make a sell. at times, you may receive phone calls, emails, or letters in the mail with special offers on credit cards. the credit lines may range from $200 up to $10, 000 regardless of your credit ratings. most of the offers tell you to sign up now before the offer expires. be cautious! most of these offer a ?slicks? to lower you into a web of debt. also, watch out for the advertising slicks that send messages, claiming that you are approved for a guaranteed credit card. most likely, the slicks have a high-paying approval line of credit to offer.
if you do find a credit card and are approved it will help you when times are tough. one advantage of credit cards is that you can head over to the bank and withdraw $500 when you need quick cash. the downside is being aware that you will be paying more than $500 back in most instances. on the other hand, you are not going deeper in debt really, (depends on the payday advance amount and fees), but payday loan lenders will attach a higher fee than many credit card lenders. for example, you could get a payday loan up to $500 at a payday advance store and may pay $82 for the loan borrowed. if you exceed three extensions on payday loans then you could pay up to 449.9% interest rates on the loans. therefore, credit cards are more reliable for offering payday loans.
no matter if, you have good, bad or no credit at all, the unsecured cards are more available to be on your side, than few of the other types of cards offered are. if you have bad credit or no credit, you may want to check out the high-risk card lenders, since many will work hard to get you a card. the lenders will also go out of their way to find a card that better suits your needs.
furthermore, if you are searching for an unsecured credit card, or any card for that matter, be sure to stay alert to each detail laid out in the terms and agreements. some card providers will charge yearly rates, monthly rates, and additional hidden charges. therefore, reading the fine print before signing a contract is the wisest thing you will ever do!
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Why Should You Go for a Student Loan?
today, education is one of the primary criterions to build up a promising career of a student. but everyone does not equally enjoy this fair advantage due to the diversity in economic status. there are several students who desperately seek for the financial aid. such students are usually funded from sources like financial institutions, charitable institutions, scholarships and even loans. the term ?student loan? explicitly means the financial assistance that is provided to a student and it is repayable after a certain period. whenever grants such as scholarships are offered to students they are like the emolument paid. they are usually provided to those students seeking admissions for higher or professional education, which requires a lump sum investment. student?s loans bear the least percentage of interest compared to the other form of loans.
in the united states the two main categories of student loans are the a) federal loans b) private loans.the federal loans may be directly endorsed to the students or handed to the parents. it is authorized by the government under the title iv of the higher education act. the federal loans in the united states are known by the name stafford loans or direct loans. when they are directly paid to the students they are repayable after their course of graduation but the amount offered to them is limited. when the parents receive the loan, a higher amount is given but the payment should be made immediately in installments.
private student loans are paid either to the parents or students. the amount that is paid is higher and the payment is made only after graduation.
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