When you start receiving phone calls from creditors asking you for payments on your debts and find out that you owe more than you realized, you probably find yourself asking just how you accumulated so much debt. Getting into debt often happens sooner than you realize. Maybe you’ve been using your credit cards to buy things that your credit limit allows, yet you don’t have the funds to cover the expense yet. Maybe you’ve taken out loans for big purchases such as a car or even a home and are struggling to pay them. It’s easy to get into debt if you’ve chosen to live above your means, but it can be a lot harder to get out of debt. The easy way to get out of debt might sound like declaring bankruptcy, but that could severely damage your financial and personal reputation. A better way to eliminate debt is to first try consolidating it to pay it off.
What Arizona Debt Consolidation Entails
Debt consolidation is a way to merge all of your payments into one payment that you pay off with fixed monthly payments and possibly lower interest rates depending on your credit score. This might be done with a loan that you either obtain from a local bank or credit union, or it could be a credit card that has balance transfers of all payments onto its account. Or instead of a loan, you might want to signup with an Arizona debt counseling service that might also act as a middleman to help negotiate payments to your creditors while at the same time helping you pay down your debt at fixed monthly prices. Keep in mind that not all debt counseling services have negotiation and debt payment options available, though some might have a debt management plan you could signup for. You may also need to hire an attorney if you suspect your creditors are practicing predatory collection practices.
Why You Might Want To Use A Loan To Consolidate Your Debt
Different financial experts have different opinions on whether or not you should take out a loan to payoff your other loans, bills and credit lines. The key to succeeding with this kind of loan is to have a real plan to pay off this loan, and to know that you can meet the monthly payment requirements. While it’s possible to use the credit on this loan to purchase other things, it’s a good idea not to use it for that but instead just stick to paying it off till it’s gone. You’ll need to do your homework and shop for the right kind of debt consolidation loan, and you’ll need to make sure you’re borrowing from a reputable bank or lending agency.
Why You Might Need An Arizona Debt Counseling Agency
While debt consolidation loans can work, they only do so if you’re willing to make changes such as the way you spend money or how you pay down your debt. If you haven’t started developing a budget or a plan for keeping track of finances, an Arizona debt counseling company can help you do that. In addition, a debt management plan can help you consolidate your payments into a manageable solution. Before you visit a debt counseling agency or choose a debt management plan, you need to do your homework on them to make sure they have good standing with the Better Business Bureau and a good rating with the local Consumer Financial Protection Bureau (CFPB).
Legal Action If Necessary In Arizona
While your creditors have the right to ask for payments on bills you owe, they still have restrictions on how they can ask for payments from you. The CFPB has some legal advice for anyone dealing with harassing phone calls or possibly even illegal collection efforts, and they’ve put them forth on this page. You can also find out more about the regulations under the Fair Debt Collection Practices Act at the Federal Trade Commission’s website. You may or may not need to hire an attorney, but it’s recommended if you believe you need someone with legal experience to represent your debt case. You should always retain records of communication with your creditors, as well as any other vital information that could be presented in court if the time ever comes.