Consolidating student loans and credit card debt
You’re in deep with credit cards, student loan payments and car loans.Minimum monthly payments aren’t doing the trick to help nix your debt, and you’re flippin’ scared.So basically, your debt would go from ,000 to ,000–60,000.If that’s not bad enough, fraudulent debt settlement companies often tell customers to stop making payments on their debts and instead pay the company.Here’s why you should skip debt consolidation and opt instead to follow a plan that helps you actually win with money: The debt consolidation loan interest rate is usually set at the discretion of the lender or creditor and depends on your past payment behavior and credit score.Even if you qualify for a loan with low interest, there’s no guarantee the rate will stay low.Pay attention here, because these crafty companies will stick it to you if you’re not careful.
The enticingly low interest rate is usually an introductory promotion and applies for a certain period of time only. Be on guard for “special” low-interest deals before or after the holidays.Debt settlement is a scam, and any debt relief company that charges you before they actually settle or reduce your debt is in violation of the Federal Trade Commission. When you consolidate your debts or work with a debt settlement company, you’ll only treat the symptoms of your money problems and never get to the core of why you have issues in the first place.You don’t need to consolidate your bills—you need to pay them off.You consult a company that promises to lower your payment to 0 per month and your interest rate to 9% by negotiating with your creditors and rolling the two loans together into one. Who wouldn’t want to pay 0 less per month in payments?But here’s the downside: It will now take you 58 months to pay off the loan.