Yes and no. Yes, existing debt that you have will be paid off as a result of the debt consolidation. No, insomuch as you are creating new debt to replace the old debt through the debt consolidation process.
The four main reasons for going through a debt consolidation process are as follows:
* Reduce overall monthly payment amount
* Reduce interest expense
* Reduce likelihood of default on one or more of the existing debts
* Simplify monthly bill payment process (by having only one check to write)
If you are considering debt consolodation, you should speak to a professional in order to help you better understand what the options are and which option is best for your situation.
Most debt consolidation services work by consolidating your debt into one loan. The debt consolidation service will pay off all of your debt balances and then make a loan to you for the amount of your debt plus any service fees. Normally the consolidated loan will have a lower interest rate than your previous debt balances.
With a debt consolidation loan, a company fronts you the money to pay off your debt (or a portion of your debt), so then your monthly debt payments get streamlined into the one loan payment. Your debt consolidation loan ideally has a lower interest rate so you can save on interest as you pay it off.
Unless you have a very high amount of debt, it is usually best to pay off your credit cards. Although it is widely advertised as being "cheaper," debt consolidation often results in higher interest payments.
How long it takes to pay off your debt consolidation will depend on a number of factors. The first thing you need to look at is how much money you owe. If you owe tens of thousands of dollars, it will take you longer to pay off your debt than someone who just owes a few thousands. The higher the debt, the longer the payoff period. You also need to take a look at how much of a monthly payment you can afford. The more money you put towards your debt each month, the more quickly you will be able to pay off your debt consolidation. When you take out a debt consolidation loan or sign up with a credit counseling service, they should be able to give you a good idea of how long it will take you to pay off your debts.
Debt consolidation is performed by a professional to help an individual pay off their debt. You can take out a loan to reduce interest rates on credit cards or other loans that you have out.
Debt consolidation can help an individual to pay off debts which are becoming unaffordable. During a debt consolidation programme all of the individuals previous debts are rolled into one debt which is paid off, usually at a lower interest rate, through smaller monthly payments.
People can get free debt consolidation care from family and friends willing to help pay off debt, or banks can help you make a plan to pay off your debt slowly and easily.
Most debt consolidation services work by consolidating your debt into one loan. The debt consolidation service will pay off all of your debt balances and then make a loan to you for the amount of your debt plus any service fees. Normally the consolidated loan will have a lower interest rate than your previous debt balances.
With a debt consolidation loan, a company fronts you the money to pay off your debt (or a portion of your debt), so then your monthly debt payments get streamlined into the one loan payment. Your debt consolidation loan ideally has a lower interest rate so you can save on interest as you pay it off.
Debt consolidation works by taking out one loan to pay off many others.
Unless you have a very high amount of debt, it is usually best to pay off your credit cards. Although it is widely advertised as being "cheaper," debt consolidation often results in higher interest payments.
How long it takes to pay off your debt consolidation will depend on a number of factors. The first thing you need to look at is how much money you owe. If you owe tens of thousands of dollars, it will take you longer to pay off your debt than someone who just owes a few thousands. The higher the debt, the longer the payoff period. You also need to take a look at how much of a monthly payment you can afford. The more money you put towards your debt each month, the more quickly you will be able to pay off your debt consolidation. When you take out a debt consolidation loan or sign up with a credit counseling service, they should be able to give you a good idea of how long it will take you to pay off your debts.
Debt consolidation is performed by a professional to help an individual pay off their debt. You can take out a loan to reduce interest rates on credit cards or other loans that you have out.
The process of debt consolidation involves taking out one loan to be able to spend in on the others such as a home loan and pay them off. One could secure a lower interest rate by this.
A consolidation debt loan is the process of borrowing money to pay off other loans. One could find information about a consolidation debt loan for a small business on the website Technorati.
The purpose of debt consolidation is to become debt free. One could merge all debts into one, and pay one monthly amount. This helps pay off all debt much quicker. Speak to someone at a financial institution about this option.
This really depends on your situation. Generally, debt consolidation loans will put you on a fixed payment plan and will keep your interest down. If you have high interest debt and can consolidate at a lower rate you should absolutely do it. Not necessarily. It probably will not help you any more or less then going through a regular consolidation company.