Debt Consolidation vs Credit Counseling

Debt Consolidation vs Credit Counseling - Exploring Debt Reduction Options
With so many debt reduction options available to you, it's easy to get
confused on which is the most effective. Debt consolidation allows you
to lower interest rates and payments on your own. But credit counseling
can help you find other ways to reduce your debt and develop future
financial goals.
Going Alone With Debt Consolidation
Debt consolidation is a quick way to reduce your interest charges and
monthly payments. With secure loans, like a cash out refi, your rates
can drop by half or more. You can also select terms that give you a
reasonable monthly payment. Remember though that the longer the loan, the
higher the total interest charges will be.
Selecting a fixed rate loan also gives you the security of knowing what
your payments will always be. There's no worry that a jump in the
minimum payment will send you into the red.
It's important to be a careful shopper when selecting a consolidation
loan. Differences in rates and loan fees can mean savings of thousands
of dollars. Fortunately, online lenders and broker sites help you get
quotes in a few minutes. You can also finish your loan application
online, with most loans closing in two weeks or less.
Getting Third Party Help With Credit Counseling
Credit counseling brings a new set of eyes to your debt issues. As
experts in debt reduction, credit counselors can help you develop
strategies for eliminating your debt. This might mean developing a budget with a
debt consolidation loan. Or they may suggest using the services of a
debt manager.
Credit counselors can point out areas where you can save money, such as
switching account holders. They also help you plan for the future by
developing a savings strategy. Credit counselors aren't simply focused on
reducing your debt; they look at your entire financial picture.
Picking The Best Option For You
Credit counseling is best for those who want to do a total makeover of
their finances. It's ideal for those who want to make long term
changes, but need help in deciding what are their best financial choices.
For those who strictly want to get out of debt, consolidating your
loans is a good choice. In a short amount of time, you can save yourself
money with better rates.