Debt Management

The most effective debt consolidation loans and programs

For legal options, protection from your creditors is provided, and a structured, framework is provided to ensure that all your debts are paid off within 5 years. With regular loan repayment and voluntary deposit program, all interest rates are reduced to 5%. With a consumer proposal, all interest is waived and a lower loan balance can be negotiated. Of course, all unsecured debts resulting from bankruptcy are discharged as part of the amount originally owed.

Cons of: All of these loan programs will affect your credit while you’re on them. The impact of some of these programs, such as a consumer proposal or bankruptcy, can be significant. However, some of these programs allow you to quickly rebuild your credit two to three years after the program ends. Not all organizations that offer these programs provide the best budgeting support or assistance if financial problems arise while you are on the program. Another downside of legal programs is that they result in a permanent record with the courts. However, the debt management program is not affected as it is run outside the courts.

One of the most positive outcomes of debt consolidation programs, especially with a nonprofit agency, is that you learn new money skills and develop new money management habits that will help you in the future. Years of preparation for success.

How to make debt consolidation loans or programs work for you

If you choose to use a regular debt consolidation loan, be sure not to fall into the trap of using repeated loans to deal with your debts. Instead, create a budget, set financial goals, and work step by step to get back on track and stick to your goals. If you’re interested in learning more about debt consolidation programs, contact a nonprofit credit counseling organization like ours, and one of our credit counselors can help you explore all of your options. Taking the time now to make a good, informed decision will give you the stable financial future you need to look forward to home ownership, investing, or even a comfortable retirement.

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