Consumer debt counseling debt consoladation consolidating
These loans, often unsecured, are based on the personal relationship rather than collateral.
In United States, there are certain companies and private law firms, addressed as debt relief companies and/or debt consolidation companies, that provide professional debt consolidation services.
You can find free or low-cost credit counseling options at: The Servicemembers Civil Relief Act (SCRA) assists active-duty military with financial burdens.
Under this act, you may qualify for a reduced interest rate on mortgages and credit card debts. It can also delay civil court including bankruptcy, foreclosure, or divorce proceedings.
In some countries, these loans may provide certain tax advantages.
Because they are secured, a lender can attempt to seize property if the borrower goes into default.
In the UK student loan entitlements are guaranteed, and are recovered using a means-tested system from the student's future income.
If you’re unable to make payments on time, you could lose your home.
Credit counseling services provide resources to help solve your money problems.
Counselors discuss your entire financial situation and help you develop a personalized plan. And they can help you find educational programs on money management.
Lenders have fixed costs to process payments and repayment can spread out over a larger period.
However, such consolidation loans have costs: fees, interest, and "points" where one point equals to one percent of the amount borrowed.
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The bulk of the consumer debt, especially that with a high interest, is repaid by a new loan.