Six Benefits of Bill Consolidation

Lower Interest Rates (more money towards principle): Consolidation companies, however, have a little more pull when it comes to negotiating better interest and fees. Creditors understand that when a consolidation company is involved, it’s a sign that their client is serious about paying off their debt. This gives them a bit of leverage to work out cheaper interest rates from you since they know for certain that they’ll be getting a payment in each month

Cheaper Monthly Payments: Since a good chunk of the total bill is cut down once you lower the interest rates, minimum payments go a longer way. For example, we consolidated three years ago and started out with around 15K in debt. My monthly payments were around $500, but Consolidated Credit was able to get one of my credit cards down from a 21% interest rate to an 11% interest rate. Once I consolidated, my monthly bill went down to $350.

Peace of Mind: Creditors’ phone calls are no fun. If you’re ever been more than 120 days past due on a bill, you know that creditor phone calls can become a daily occurrence. There is nothing like the stress of someone calling multiple times a day asking you for money that you don’t have. Especially if it’s gone to collections and they demand the payment in full. In a relatively short amount of time, consolidating companies can make those calls go away.

Improved Credit Rating :No one knows exactly what the algorithm is that’s used to determine your credit score, but one thing we do know is that paying off debt increases your debt to credit ratio. Your debt to credit ratio is the amount of money you owe in comparison to the amount of credit you have. Decreasing your debts puts a bigger gap in between what you owe and what the amount of credit you’ve been approved

Support Network: Surprisingly enough, a debt consolidation company can provide a network of support for debt repayment. I found that when I called the consolidation company each month to update them on the status of each bill, they were always really encouraging and mailed out budget advice and tips on a monthly newsletter. A network is crucial to staying on track.

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