Category: Debt Counceling Advice

An unsecured debt loan is a type of loan that does not require a collateral. A borrower can use a line of credit without necessarily needing a personal property lien. However, an unsecured debt loan usually has a rate of interest that is higher than that of a secured loan.

Since there is no use of any asset as collateral, the borrower does not have to produce any property to secure the loan for lender and therefore, the lender does not have any means for a lien on the assets of the borrower if the loan is not repaid as agreed.

With an unsecured debt loan, if the repayments are not made, the lender and the borrower are free to re-negotiate the terms of the repayment. However, with unsecured debt loans the main downside to the borrower is they have higher interest rates than secured debt loans.

One of the advantages of an unsecured debt loan is since there is no property involved in processing the loan, the loan can be approved much faster. This saves time and moves the
loan transaction forward soon as the lender processes the loan with the borrower.

However, for you to get an unsecured debt loan, you must ensure that you are credit worthy since the lender will use your credit history to determine your credibility. This is because of the lender’s goal to lend money only to those who show a good indication to pay the loan back.

Therefore, for people who want to borrower but have a bad credit history, using an unsecured loan will be harder to get an application accepted. This, however, does not mean that if you have bad credit you will be denied an unsecured debt loan for sure.

Currently, there are many lenders who are willing to take on risk by lending their money to people that have bad credit. To these creditors, bad credit is not the only indicator of credibility.

Another advantage of an unsecured debt loan is that you have the ability of consolidating all your debts into one easy monthly payment. If you want to apply for this type of loan, you must have verifiable employment and a good credit score.

Your debt should also be low when compared to your income ratio. Most people that have debts choose companies that consolidate debt because they provide unsecured debt loans.

A representative of the debt consolidation company will assess your financial situation and your capacity to repay back the unsecured debt loan. The representative will then negotiate with the creditors to see if they can reduce the balance of your loan amount and the rates of interests available based on the market and your credit worthiness at the time of application.

An unsecured debt loan best fits a person that has no assets to offer as collateral and also has a poor credit rating. Even though you must realize that unsecured debt loans have higher interest rates than the secured type, the monthly installments paid can be low to fit your income level.

By promptly paying down on an unsecured debt loan, (keeping up with your payments) your bad credit rating can then begin to show improvement. Do not make the mistake that some borrowers believe since the unsecured debt loan is not tied to personal assets or property, that the lenders cannot take any legal action against them in case they default on the repayment of the loan.

However, if the borrower does not repay the loan as agreed, he or she can be taken to court where a judge will decide what type of action is to be taken whether you have acquired any assets during the load period or anytime after.

Getting Good Debt Counseling Advice Can Change Your Life

It seems like many people are having financial troubles these days and the truth is many are however being the challenge that it is, there is help for those who need it.

Whether you’re struggling because of the economy, you lost a job, you’re under employed or your expenses have increased, there is assistance available. Finding the right kind of debt counseling advice can be the difference between gaining control of your finances and potentially losing everything.

Why Use Debt Counseling Advice?

The first thing to remember when seeking financial help through a debt counseling service is that it’s advice you can use to help turn your situation around. They will look at your  debt information and give you the advice on the best way to get yourself out of financial trouble.

You are not required to sign anything just to get counseling and it is completely your choice whether to follow their advice or not. It’s a great way to get an unbiased opinion about your situation.

Review Your Finances

The first thing that will happen is a complete review of your finances. This will include all types of income you have and all of your expenses. When you go through this review, it is critical that you be honest with the person you’re speaking with if you want to receive the most appropriate debt counseling advice.

Recommendations and Advice

Once the review of your finances is complete, the counselor will provide you with advice and recommendations on how they think you should proceed.

This type of advice can go a long way toward solving your financial problems.
The fact is that a lot of people end up in financal trouble because they were never taught how to manage their money properly.

Getting quality debt counseling advice can provide you with resources and tools to teach you how to do this. You can learn how to set a budget and get tips on how to stick with it.

You will also learn the difference between expenses that are a “must have” and those you “want to have but can’t afford”. This is a lesson well-learned for now and the future if you want to get out of debt and stay debt free. However, this does not at all mean that you will never be able to buy the things you want, only that it will show you buying disciplines that will make you a smart consumer.

In your quest for help with your debt, you may be eligible to reduce some of your expenses in ways you have never before considered. As well you may be able to refinance your mortgage, reduce your insurance costs or even get a cheaper phone plan.

A service that provides good debt counseling advice will be able to direct you to other resources that can help with many types of helpful things.

Consolidating your credit card expenses is another piece of advice you may be given. In most cases, these businesses can provide you with interest rates that are much lower than you are currently paying.

The process works with them contacting your credit card companies and seting up a repayment plan. You will then pay the counseling service,and they will pay your credit card companies. This can end up saving you money each month, and it will help you pay off your credit card debt much sooner than you would be able to on your own. Plus, it helps take the pressure off of having too many payments to go out consolidating your bills all into one single payment.

Of course, if you are in much more serious financial trouble, your debt counseling advice might be to consider filing bankruptcy which many times has been the only way to provide the necessary relief, yet at the same time provides a plan for a fresh start.

If you are in financial trouble it is important that you seek professional advice and begin to work on bringing your situation to a better place which is possible with the help that is available.

Getting good Debt Counseling Advice is paramount to help get your debts paid down and to regain control over your finances once again.