The Four Options Of Debt Consolidation | All About Financial Matters

Our aim here is to tell you everything you need to know to make a good decision if you are looking at consolidating your debts. There?s many options you need to consider and you may have to be honest with yourself to help determine the best solution.

First question you need to ask yourself is how much debt do you have? Is it a relatively small amount, or is it a larger amount. For now we?ll look at under ?10,000 and over ?10,000 just to make this easier

Unsecured Loan

Firstly there?s an unsecured loan. An unsecured loan is a good option if you have an absolutely perfect credit rating and have a relatively small amount of debt (less than ?5000 generally). If you?ve missed payments, made late payments, have any defaults or CCJs then you are unlikely to get an unsecured loan.

Debt Management Plan

If you have up to ?10,000 of debt, you can apply for a Debt Management Course. A Debt Management Plan is perhaps a better option if you?re looking to get your debts paid off or have had trouble keeping up with your payments at the moment.

Secured Loan

If you?re a home owner, you could look into getting a secured loan. You are more likely to get a secured loan than an unsecured loan, even if you?ve had credit problems in the past because the loan is secured against your home. The advantage of this is that a lender is likely to offer you more at a better rate, even with problems in your credit history. The disadvantage is that you could lose your home if you fail to keep up with your repayments so think very carefully. A secured loan could be offered for any amount to consolidate both lower and higher debts.

IVA

Finally, there is an IVA (Individual Voluntary Arrangement) An IVA is a legally binding agreement between you and your creditors organised by a licensed Insolvency Practitioner (IP). Their job is to negotiate with your creditors and reach an agreement as to what you can afford to pay back. You?ll pay back the IVA in one monthly payment for five years, then the rest of the debt will be written off and you?re free to start rebuilding your credit rating.

Jim Seward writes for consolidateuk.com?a_aid=marketrix&data1=ezine&data2=fouroptionsofdebtrelief Consolidate UK who offer consolidateuk.com?a_aid=marketrix&data1=ezine&data2=fouroptionsofdebtrelief debt consolidation loans to those struggling with their monthly payments. They also offer helpful tools

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Source: http://www.story-of-finance.com/the-four-options-of-debt-consolidation.html

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