If you overcharge or rely too much on your credit cards to cover shortfalls in your budget, your monthly debt payments might become more than you can
manage. Debt consolidation is a means you can use to regain control. if you act fast, you'll be more likely to avoid things like bankruptcy and severe
credit damage caused by missed payments and collections.
What is Debt Consolidation?
Debt consolidation is the process of combining multiple debts at the lowest possible interest rate. Instead of paying several different bills every
month, you only have to worry about one . At the same time, because the interest is lower, your debt will not grow as fast and more of each payment you
make goes to paying off the principal (original debt owed) versus the interest accrued every month.
How Does Debt Consolidation Work?
Instead of having multiple debt payments every month, you only have one payment to worry about. The end goal in consolidation should always be to get the lowest
interest rate possible. There are a number of possible ways to consolidate debt such as:
- ● The Federal Housing Administration (FHA) now allows you to take up to 80% of the appraised value of your home in cash, giving you more flexibility to
- ● Fannie Mae's Agency Products also allows you to take up to 80% of the appraised value of your home in cash, which can be used to pay off unwanted
debt such as high interest rate credit cards.
What Are The Risks When You Consolidate Debt?
In most cases, as long as you consolidate your debt in the way that's right for your situation, you'll have very little risk and a lot to gain.
It's best to make sure you're using the right option for your unique financial circumstances. The payments should be manageable for your budget
as long as you stick with your payment plan.
What If I'm In The Military?
If you’re a service member, veteran or military family then you may have special options to consider if you need to consolidate debt. The process will
stay the same, but you're taking advantage of military discounts and VA loans to reduce costs as you eliminate debt. Veterans Administration
allows military veterans and active duty to access up to 95% of their homes appraised value for debt consolidation on single family residence.
If you are interested in Consolidating your debt, give us a call at (931)906-1489 or use our contact form on the right.