Free Credit Card Debt Consolidation
July 29th, 2009 | 
Author: Our thoughts about money are beginning to change. Free Credit card debt consolidation and dealing strictly in cash are two of the new the most common changes that people are making. Making your own debt management plan is your plan is going to be the only truly free method of debt repayment.
A debt consolidation loan will require you to pay closing costs, but you may be able to have them added to your loan. Paying off debt with debt has gotten many people in trouble. You must use your home as collateral for most debt consolidation loans. Defaulting on the loan can lead fo foreclosure proceedings. If you look at the recent economy, taking out a home equity loan a few years ago may have put you upside down in your home loan. This is not a comfortable position.
A debt settlement company will charge you based on the amount of money they are able to save you on your credit card balance. The normal fee can be anywhere from 15% t0 25%. So, if they save you $2,000, you will be paying from $300-$500 for this service with a net savings of $1,500-$1,700. But, here comes the downside. You will have to pay taxes on that same amount and this transaction will not be reported favorably on your credit.
Credit counseling service is another option you have and for most people that want help managing their debt this alternative is best. In most cases, you will see your interest rates be reduced to 10% or lower. If you are currently paying over 20%, this is huge and will save you thousands of dollars and several years. Find out just how much you can save with an interest rate reduction just by playing around with any debt calculator. The cost of this service normaly varies from $30-$50 a month. Having to make only one payment each month is one of the biggest conveniences of debt consolidation.
Although these are not free credit card debt consolidation options, they are going to cost you less than what you are paying now. Some debt relief methods are better than others and not all will work for all situations. It will depend on your personal debt situation which debt relief solution will work best for you.
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