All about: online debt consolidation

Consolidating debt enables you to manage your finances better and helps you to improve affordability. A consolidation loan is one way in which you can achieve this objective, but there are other debt relief solutions that are equally effective. Whether a low secured loan rate of free debt management is superior or not depends upon your credit history during the last seven years.

Consolidation with a good credit history

A good or excellent credit rating provides you with far more options. Debt assistance could come in the form of online debt management or a low rate refinancing loan. Free debt relief, such as a debt management plan, could hurt your credit score because it involves defaulting on the terms of your unsecured credit agreements. A good credit history is something that most people want to preserve, so a loan to consolidate debt is likely to be the preferred choice.

Debt consolidation loans

Rather than making lots of small payments to different creditors, you can consolidate debt with a secured homeowner loan. The idea is that you borrow a sufficient sum of money to pay off all of your other debts and make just one payment each month. You could even increase the repayment term so that less of your disposable income is going towards servicing debt. If you have a good credit history, it's worthwhile applying for an unsecured loan from Prosper.com or Lender Tree. If you need to borrow more than $25,000 or you have really bad credit, you may need to get a secured loan for debt consolidation against the equity in your property.

Debt consolidation with a bad credit history

Poor credit not only affects your ability to get a loan, it also increases the cost of borrowing. The only way that you can get the best consolidation loans is by using your home as collateral. If you don't have enough equity or you want to avoid putting your family home at risk, a free debt management plan could provide the answer.

Debt management help

A debt management program doesn't involve taking out a loan. There are similarities in the sense that you make just one payment each month, but this is done on the basis of a voluntary agreement with creditors to pay your creditors what you can afford. Many lenders and issuers are prepared to freeze further interest and charges. An intermediary takes care of everything in return for a management fee that's deducted from each payment. When you already have adverse credit, a debt relief solution is unlikely to do your credit score any further harm. Seek impartial debt management help from a non-profit credit counseling service because it's important to choose the best solution for your unique personal situation.