Saturday, 30 August 2008

Debt Consolidation: The Benefits of Unsecured Loans for Debt Consolidation

Of course, no one in their right mind wants to file bankruptcy.

Lawyers are notorious for telling people that there is no other way but to file for bankruptcy. Likewise, any source that tells you that they can eliminate debt is leading you on. Reality is structured to keep everyone in debt. No one has the ability to get out of debt unless they die. However, there are solutions for minimizing debts so that you can remain stable.

The unsecured loans for debt consolidation are nothing more than subtracting a series of debts and adding new debts. Sure, you may pay less, but in the long run, you still owe something to someone.

To give you an idea of unsecured loans for debt consolidation, I am going to breakdown the balance of a hypothetical loan scenario.

Let's say that you owe a number of creditors $10,000: you can go to a debt consolidation organization that offers you the loan amount. Now, you have depleted your debts from the other lenders, but you incurred a debt from another lender. Let's say there are fees (which in most instances is true) and those fees equal $39 plus a 4.49% interest. On a $10,000 unsecured loan for debt consolidation, you would pay around $834 per month to repay the debt. If the company charges $39 plus interest and the capital on the loan, it would only equal around $759.30 per month when applied to the loan. This means that it would take you longer than one year to repay the debt.

Finally, there are solutions for paying off debts without getting in more debt; however, most of these solutions will require you to actually deal with your own creditors and will also require you to exercise an enormous amount of personal restraint in your financial decisions.

5 comments:

Randeg said...

You explained the scenario of paying off the debt the way it should be explained - with much honesty and desire to help the people in debt. I hope all of them will be able to read what you wrote as it will open their eyes to the reality of it all. There are some scam artists out there they should avoid at all cost.

Evelyn Guzman
Debt Challenger

LittleStar said...

Everyone's situation is unique but, if you do as much research as you can and use debt consolidation articles and other tools you find as a general guide, you can customize it to fit your situation.

Manika said...

There are so many unsecured loans on the market these days with an increasing variety of rates, fees and features that it really pays to shop around. Thanks for the info!

Susan said...

I recently came across your blog and have been reading along. I thought I would leave my first comment. I don't know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.


Susan

http://www.car-insurance-choices.com

bhargava said...
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