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This way, you can not only avoid having any negative reporting on your credit history but you can eliminate a bunch of different accounts and have only one. There are a really only a few ways for debt consolidation to really work for you. Here are a few ideas.
If you have a good banking relationship with your bank, talk to them about a loan so you can payoff all your outstanding debts at one time, leaving you with only one smaller payment to make, at a much lower interest rate. If you don't have bad credit at this point, the bank may consider give you a consumer loan. The bank may also suggest consolidating all your debt to a home equity loan. What this basically does is takes the equity that you have built up in your home and allows you to borrow against it. Almost anyone can borrow against his or her equity because you are using your home as collateral. This type of account is like a revolving checking account. They will give you checks and you write them to who ever you want. The payment due each month will depend on how much you actual spend.
If your debt has gotten to the point that you have people calling you constantly for payments, your credit may already be too damaged to go through your bank. A credit counseling service is probably going to be your best bet for a debt consolidation resolution. What a credit counselor will do is contact all the people you owe money to. They will then try to get these creditors to work with them. They try to get them to stop adding late payments and get your interest rates dramatically cut for you. Some of these counselors are non-profit organizations and some may require a monthly fee. So if you have had it with just barely getting by with paying the minimum monthly payment, try debt consolidation. This will help you to make one manageable monthly payment. This will help you to get out of debt faster and hold the damage to your credit report to a minimum. You will no longer have people hassling you and you won't need to declare bankruptcy. For piece of mind this is a really good option.
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