There is no doubt that numerous people across the globe are struggling with a pile of loans ranging from mortgage to student loans leading to debt problems that affects their relationship, well-being or even their sleep. Dept problems are a common difficulty in the society today primary attributed to poor financial management with the expenditure along with bad investment decisions.
Most people with debt problems would consider owning more than two credits cards in an attempt to juggle paying the various loans between the various financial institutions in which they are indebted. This, however, does not save the situation in any way rather, it worsens your financial state considering the high-interest rates accrued in servicing each loan you owe. If you are in such a stressful situation, you may consider approaching a non-profit debt consolidation also known as debt help to effectively resolve your financial shortcomings.
Non-profit debt consolidation functions to assess your financial situation and subsequently develops a workable plan to enable you to pay your loans in many affordable terms along with training you on financial management. They are a group of non-profit making organizations that provide a number of debt consolidation service including financial advice on debt management from a professional financial counselor, debt consolidation among other services aimed at providing solutions to your growing or stressful loans.
Type of Services Offered
Non-profit debt consolidation offers two main financial services discussed below:
Credit Counseling Services
Credit counseling services involve offering credit advice along with various resources from a professional credit counselor in an attempt to solve your financial problems via an effective financial management plan. They educate you effective budgeting and developing a personalized financial plan after analyzing your entire financial situation.
Benefits of Credit Counseling
Credit counseling is regarded as the first step in solving your financial problem. A certified credit counselor will assist you in coming up with a suitable solution for your credit or debt issues.
Debt consolidation is the second service primarily offered by non-profit debt consolidators. As the name denotes, debt consolidation refers to pooling all your loans along with selected expenses into one monthly payment thereby significantly cutting on the loans interest rate or penalties. In such an arrangement, you would be making bringing all your unsecured loans under the management of a debt consolidation agency and subsequently making a single monthly payment to the agency who in turn channel the agreed cash amount to your creditors. This enables you to plan your finances early enough enabling you to avoid unplanned spending while you still have loans to pay.
Advantages of a Debt Consolidation Program
- A debt consolidator negotiates with your creditor to consolidate all your credit card payments into a single monthly payment that matches your income or budget, therefore, you will not have to obtain loans to pay existing loans.
- Debt consolidators are vital when it coming to negotiating a suitable interest rate on your loans with your creditor. They may help lower the existing interest rates by acting as guarantors for your loan or spending the loan over a longer repayment period.
- For instance, you defaulted on repaying an existing loan leading to a poor credit record, a debt consolidator has the power to erase the poor credit record two years after full repayment of the loan.
Signing up with a non-profit debt help agency comes with enormous benefits that will enable you to realize a desired financial discipline along with saving a lot of money in the form of interest. However, it is crucial to sign up with a legitimate company as some agencies are scams stealing from vulnerable individuals.