Some Bad Debt Consolidation Moves To Avoid
Even while you are in the process of selecting the most suitable debt consolidation agency, there are at least three bad debt consolidation moves which you should avoid at all costs:
a) Debt consolidators who guarantee to take care of everything
Most debt consolidators have a build in a fee as part of the monthly payment that you have to make them. It is usually about 10% of the payment. Ask yourself if it is worth paying somebody to do what you can probably do on your own. The best option is if you can negotiate with your creditors for lower interest rates and stretch out your repayment schedule. In some cases, consolidators are known to make late payments or even miss payments and thus harming your credit record.
b) The hard-money loan
Don’t get lured by the offers of easy-does-it loan by the consolidator. Chances are that you may end up paying you higher interest rates than you're paying now. Ask your consolidator to look for other alternatives, like, negotiating with your creditors for better repayment options.
Now, if you are a own a home and have some equity in it, go through some of the good debt consolidation moves which will help you steer towards the right path in improving your credit score and manage your debts efficiently.