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15 Debt Elimination Steps You Must Take Now
What Everybody Needs To Know...Learn The Truth About Debt Elimination!

Here`s how we have been taught to charge, charge, charge and promised Easy monthly payments by advertisers who seduce us into debt. So its no accident that the credit, finance and loan companies end up with most of our money, while we end up with all of the bills.

Debt Elimination tips shows how Millions o... Read debt consolidation article



When bad credit meets a co-signer with good credit
"Oops! You did it again! Didn't pay another bill? Has debt taken such a toll on your life that you cannot live in peace? Is your bad credit history affecting you so much that you can't even consider taking a loan? Well, it is common for loan lenders to reject applications from people with bad credit history. So is there any option left, at all? The good news is, there is!. For someone w... Read debt consolidation article



UK Debt consolidation loans
Your current situation.

You have got several credit and store cards and several loans. You are finding it difficult to make the payments each month. Generally you do make the required payments but this means that other parts of your like are suffering. You've got no spare cash for the occasional night out or weekend away. Even making the minimum payments each month means that the outstanding amounts are never reducing.

The equity in your house.

If you have owned your house for several years there is a chance that you have something called equity. This is the difference in the current value of the house and the total amount of the outstanding mortgage. So if you have an outstanding mortgage of £80,000 and your house is now valued at £170,000 you have got equity of £90,000. There are certain companies that will lend you money based on this equity. They are safe and secure in the knowledge that if you default on your payments that they can get their money back by selling your house. That's the small print "Your home is at risk if you do not keep up payments"

You can use this new loan to pay off all your current credit cards and loans and have a reduced monthly payment. This method of using the equity in your house is called loan consolidation.

Current loans and credit cards

Lets says that the total amount outstanding on you credit cards, store cards and loans is £20,000. If the equity on your house is £90,000 you should have no problem getting a second mortgage of £20,000. However you will still need to be in employment and prove that you can make the monthly payments.

Documentation.

Before you apply for a second mortgage with the intention of paying off your existing debts you should get all your paperwork together. This will save you time and make the loan process much quicker. Here is a list of the documentation that you will need. Different loan companies will ask for different things so just get all the documents together ready for whatever they want.

Last three months payslips. Last three months bank statements. Council Tax bills. Electricity bills. Gas bills. Water bills. Marriage certificate. Passport. Driving licence.

Not all those documents are essential but it will slow the process down if you don't have them available.

You'll also need full details of the credit cards, store cards and loans that you want to pay off. This includes the name of the companies, the account numbers and the outstanding amounts.

The new company will actually issue with individual cheques that you send to these companies, you don't actually get a cash payment to yourself.

Caution

Let's say that your loan application has now been processed, you have paid off all those outstanding debts. The weight has been lifted off your shoulders. You now need to be very careful. If you run up any more debts at this point in your life then you will be in deep trouble.

Make sure you cut up and return all but one of your credit cards. You need to keep one so that you can use it for purchasing things on the internet and making hotel reservations etc. Maintaining one credit card will ensure that you keep a good credit history. Do not apply for any new credit cards or loans.

Your monthly payments on the new loan will be significantly lower than the total of your previous credit card payments. But, you need to take advantage of this situation, it is no use spending the extra money on useless luxury goods. You have to use this opportunity to stabilise your financial life. I suggest that you save at least half of the extra money that you now have each month. This will give you the chance to build up a buffer in case you suddenly find yourself unemployed.

If you need some help in deciding to be disciplined just consider what your life will be like if your home is repossessed.

The bad news

Although your monthly payments are now lower, the reason for this is that you will be paying the loan off over a much longer period. This is how the loan companies make their money. And because you are paying the loan off over a much longer period you will also be paying a lot more than the value of the actual loan. For this reason it is vitally important that you discuss all possibilities with your Independent Financial Advisor.

Summary

Getting a debt consolidation loan can relive you of a lot of stress and worry. But this comes with a long term financial penalty. It is thus vitally important that you don't run up any more debt. Work at paying off that loan as quickly as possible and regaining your financial freedom. For more information visit: www.ukmortgagewithbadcredit.com

Disclaimer: Please note, I am not a Financial Advisor and this article is for informational purposes only. You MUST consult with an Independent Financial Advisor before entering into any financial agreements.

If you want to learn more about debt consolidation loans please visit the following web site. http://www.ukmortgagewithbadcredit.com

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How to reduce or eliminate credit card debt

Of course, The best way to get out of debt is not to get into it in the first place - in other words, pay off your credit cards fully every month. This is really the only way to be debt-free, enabling you to avoid interest and finance charges. None of the major credit card companies (Visa, MasterCard, American Express, or Discover) penalize you for doing this.

The ideal is to live within your means, spending less money than you make. It is a sure way to stay out of credit card debt.

The Solution

But if you are reading this, chances are you've already accumulated too much credit card debt. Here are your options:

Option #1: One thing you can do if you have outstanding balances on high interest credit cards, is to do a balance transfer onto a lower interest credit card.

Of course you first need to have a balance transfer offer from a credit card company, with a card that has a lower interest rate than the one you are trying to pay off. Visa, MasterCard, American Express, and Discover all have a variety of different cards, with different interest rates. By transferring your balance to a card with a lower interest rate, you can save hundreds if not thousands of dollars in interest charges. You can compare these cards online (see resource box at bottom).

If you get lots of offers (as you will if your Equifax Score is higher than 690 - rated "good" - and you may even get a few while rated "fair") you will be able to pick and choose among balance transfer offers. Look for ones that keep the low rate until you have paid off the balance transfer completely. In some cases, you may want to accept one that raises the rate after some months, as long as that new rate is lower than the one you have on the card you are trying to pay off.

Sometimes the best balance transfer offers come with a new credit card. You will find reviews of some of the best at http://www.creditoffersreview.com/. Do remember, however, not to apply for too many at once - sure to lower your credit card score.

A Few Things to Remember

For ease in understanding, we will call the high interest card you are paying off Card A, and the one you are transferring balances to, Card B.

1. Be careful to continue making payments on Card A. until your payment shows up (you can check most credit card balances on the credit card website, by logging into your own account.)

2. Try to time it so your transfer pays that month's payment. Do this by making the balance payment right away when you have just received your statement for Card A. That gives several weeks for the payment to post. Then you will not need to make a regular payment that month and can apply more to some other card.

3. Experts vary on their advice about what card to pay off first. I prefer to pay off the highest interest card first, but others say the satisfaction of paying off a card with a smaller balance (because you can pay if off quicker) is important to your motivation to keep paying down that debt. I get my satisfaction in seeing the interest and minimum balances drop drastically as I pay down the very high interest rate card.

4. Be careful to leave a few hundred on Card B so its next interest charge will not make you overdrawn. Apply as much as you can to Card A, but not all of it.

5. Be aware that almost all cards doing balance transfers with a very low interest rate offer are going to apply any payments you make to those lower transfer balances first. So it is best if you only do a balance transfer to a card that is totally empty. If you have charges on it at its normal interest rate, they will continue to accrue finance charges at the higher rate all the time the lower rates transfers you did later are being paid down.

Option #2: You can also transfer your balance from a high interest card to one with a low introductory interest rate - If you are like most of us, you probably get these in the mail all the time. "Limited time offer!" "Pay no interest for 6 months!" "0% till next May!" All of these cards offer an introductory low APR (sometimes 0%) when you get their credit card. But you have to be careful if you use this option. Use it only if you plan to pay off the balance BEFORE the grace period ends. If not, you might end up paying more than you would have originally.

Option #3: Another option is to get a credit card debt consolidation loan - it can take a lot of the stress out of trying to juggle credit card accounts. It allows you to consolidate all your credit card debt into one easy payment at a fixed interest rate. This rate is almost always lower than the one the credit card companies will give you. The draw back is that you have to be very careful who you get such a loan from, especially is they promise they will negotiate lower credit card payments, so that you are not paying all you owe. If it is from a credit counseling agency like that, it may harm your credit rating.

Before applying for any credit card, you may want to discuss with your financial advisor which credit card's best for your unique financial situation.

Author: Arthur Roberts. Arthur Roberts is owner and senior resource writer for http://www.creditoffersreview.com/, a web site that presents credit offer reviews organized by category, type, or issuer, to help anyone find the best possible credit card offer for each individual and circumstance. This article is copyright2005, and may be reprinted in its entirety as long as it includes this resource box information.


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