Understanding credit counseling and how it works

When an individual is drowning in a sea of debt, credit counseling can be their lifesaver. Credit counseling offers guidance and support on issues like consumer credit, budgeting, and money and debt management. Most of the time, the objective is to help a debtor get out of bankruptcy and to provide them with fundamental education on financial management. 

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Well-respected credit counseling firms are usually not for profit and offer services online, at local offices, or on the phone. Before a person goes through their first session with a credit counselor, they would have to gather credit card bills and other details such as income and household expenses. The counselor will use these documents as the basis for the solutions to one’s debt problems. 

It can be a challenge to open up to a stranger about one’s personal financial burden. A person should feel comfortable with their credit counselor. Just because a counselor has been assigned to them, doesn’t mean they would have to stick with them even if they don’t feel like it. It’s best for a debtor to find a credit counselor who is supportive and that would make them feel like they have hope.

Credit counseling works when a debtor sticks to the plan. Usually, a debt management program is used as a means to resolve debt issues, and it’s proven to be most successful when partnered with the budget advice provided by the counselor. Following a counselor’s advice and making timely payments to creditors creates a path for one to become debt-free. 

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Consolifi is a debt resolution company that helps consumers break free of debt and walk toward financial independence. For more updates like this, visit this blog.

Preserving your credit score while repaying debts

People in debt may be tempted to declare bankruptcy as a way out of their mounting obligations. As an option, however, declaring bankruptcy is far from the ideal recourse and should not be considered lightly. It is only often in truly dire circumstances when the consequences of filing for either Chapter 7 or Chapter 13 would be preferable to continued debt. 

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Frequently, however, the side effects of bankruptcy are themselves damaging to one’s credit score, making future financial assistance impossible to acquire. Bankruptcy also leads to the liquidation of most assets, including those dear to the owner. 

Rather than avail of the last resort, debtors can instead pursue other debt resolution strategies, which would allow them to pay off their creditors in a timely manner without damaging their credit scores in the long term. 

Most forms of debt relief involve consolidating multiple payments to other parties into one that can be paid off at a more flexible or reasonable time. This can range from taking out a loan to be used to pay off other creditors, to working out a more reasonable lump sum or terms of payment to a creditor.  

Often, creditors are more than willing to make flexible concessions to ensure cash flow. If the reworked payments are received on time, one’s credit rating is not negatively affected. 

Those with debts that may be too difficult to track, but are not unpayable, may opt to have their debts managed by professionals. 

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Consolifi provides debt settlement services to help people get back on track with their finances. Visit this website for more on the advantages of debt settlement.

Small steps: A close look at everyday debt-reduction strategies

One of the many goals of people today is to be free of debt, a herculean task but not an impossible one. There are many everyday ways to cut down or even eliminate debts. 

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“Pay more than the minimum” is perhaps one of the best words of advice for people with accumulative debts like credit cards. Paying only the minimum monthly balance allows interest to gradually accrue on your debts, which can lead to hefty interest payments that approach or far exceed the original principal. Paying more than the amount covers both the principal and part of the interest, gradually paying off both. 

When faced with multiple debts, a variation of this strategy can be used, diverting the greatest amount of funds to pay off the smallest debts and working upwards from there. The larger debts are paid at a minimum until the smallest debt is paid off, upon which the debtor diverts more funds to the next smallest debt in line. 

In many cases, where paying for all the outstanding debts would take too long (and thus cost too much), a debtor may instead opt to consolidate the debts into a single fund. On their own, debtors with a sufficiently sterling credit rating can accomplish this by taking out a personal loan, which would be used to pay off the creditors all at once. 

Finally, debtors can resolve their debts much faster by budgeting. Increasing cash flow and cutting back on expenses (sometimes to just the essentials) can help muster the cash for quicker debt payments. In addition, more conscientious spending can prevent debt. 

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Complex debt issues may require professional assistance. Learn more about debt settlement and its advantages from the Consolifi website.

Handy Ways To Repair Bad Credit

Credit repair isn’t hard or impossible. It can be done with time and the right steps – as well as the resolve to borrow money on affordable terms and without courting financial disaster. Here are some tips to mend bad credit and improve credit score.

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For starters, review those credit reports with diligence. Now is the right time, so ask from the credit bureaus such as TransUnion, Equifax, and Experian. You may also use a free online service, where you can see your credit scores after signing up and view pertinent information.

Once you have those credit reports, read through them thoroughly, taking several days if necessary. Become familiar with the details contained there, particularly the types of information you’ll need to repair such as incorrect information, past due accounts that are late or charged off, and maxed out accounts that are over the credit limit.

Exercise your right to dispute any inaccurate, incomplete, or unverifiable information in those credit reports. Disputing online is typically faster and easier to do but leaves you with no paper trail, although you can take screenshots of the dispute.

Decide if you want to play the game of some credit repair companies. Once you have decided which way to go, start playing down outstanding balances, which could be difficult to pull off as a short-term strategy to increase your credit score but should be necessary in a long-term financial plan. It will also prevent you from paying as much interest.

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Consolifi is a debt resolution company with the objective of assisting consumers in breaking free from their debts permanently. Learn more about financial wellness on this page.

Financial Advice For Millennials, How To Avoid Credit Card Debt

Millennials have it tough. From the challenging job market to less desirable housing options, not to mention paying off student debt, young folks have to constantly wrestle with their finance. And with credit cards, it’s sometimes a losing battle. Here are some ways on how to avoid credit card debt.

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Avoiding unnecessary purchases is always the top tip people can give millennials with credit cards. This is one problem shared by everyone. Buying things one wants but doesn’t necessarily need can rack up on credit card debt and get out of hand. A good rule of thumb is to ask yourself if you can pay for the item using cash. If the answer is no, do not buy.

Paying on time saves users from nasty fees. New users could easily mistake these fees as simply one-time items like a separate purchase. However, late payments can hike up one’s interest rate if it becomes habitual. Not only does this result in a bigger debt, but it also damages one’s credit rating.

Never lend your credit card to anyone without your supervision. You may be disciplined in how you use your card, but maybe your friend who’s in need doesn’t have as much restraint as you. And keep in mind, on the off chance they don’t pay you back, it’s your credit ratings that suffer.

Lastly, limit the number of cards you have. People who use multiple cards can have problems tracking which one needs to be paid off. Overdraft issues are also common for multiple card holders.

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Consolifi is a debt resolution company that gives clients solutions to permanently manage outstanding debt. To know more about its services, visit this website.

Debt And Collection: a Bigger Picture

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Debt is part of everyone’s lives, and so is debt collection. In the United States, millions upon millions of Americans are in some way, in debt. According to national statistics, over 30 million people living in America have unpaid debt. While this number is staggering, it should be noted that debt comes in many forms, from student loans, to mortgages, to unpaid medical bills, to unpaid parking tickets, to unpaid highway tolls.

As such, it comes as no surprise that countless agencies in the debt collection industry have been hit with an endless number of complaints from people and businesses who owe money. The number of complaints for debt collection agencies is so high that the Consumer Protection Bureau entertains more complaints against debt collectors than any business in the United States. Although it should be worthy to note that almost 4 out of 10 of those complaining are seniors.

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Households in the United States for example, are over $15,000 in debt to credit card companies (on an average). College graduates, also on an average, owe almost $30,000 to loaning companies or the government. This is quite puzzling since around half of the people who’ve graduated from college, who are also in debt, are employed by companies that don’t require college degrees.

Consolifi gives clients guidelines on understanding debt settlement companies. Learn more about Consolifi’s services here.

How To Save Money Series: Vacation Time

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Vacations can cost an arm and a leg, especially if one doesn’t consider looking for alternatives to the first options when it comes to dining or transport that pop out during the trip. Luckily, several travelers have found hacks on how to save money during the experience. Below are some of them.

Money Exchange

Seasoned travelers highly recommend that people change money before they go on a trip. They are also cautioned to refrain from changing dollars at foreign airports. Money changers at airports have the worst rates.

Hotels

Experienced travelers note that the only reason people should book a stay in a hotel during a trip to a foreign city is if that’s where they plan to stay the whole time. Hotel resorts are perfect examples of this. Hotel rates are nowhere near cheap. For the most affordable places to stay in, people can check out hostels and used apartments.

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Eateries

Restaurants and other similar establishments near tourist destinations are traps in every sense of the word. The prices are jacked up, and the food is mediocre at best. The best food in a city will rarely be found near historical monuments. Ask the locals or do research regarding the restaurant districts. These are the places to be if people want to enjoy the local cuisine.

Consolifi gives its potential and existing clients guidelines on how to better understand debt settlement companies. Read more about Consolifi and its services here.