You might have heard that it’s very difficult to try and consolidate your bills when you’ve got less than favorable credit. Do you have poor credit and you’re hoping to consolidate your bills, but you don’t know where to start? Although it might be a trying process to consolidate your bills with credit that’s a mess, it’s not an impossible thing to do, and you won’t have to head into bankruptcy court to get relief from your sweltering debts. Avoiding the bankruptcy option will do the most to raise your credit score and choosing to consolidate your bills will certainly make your financial life much easier to deal with.
Forget About Traditional Consolidation with Bad Credit
- Low balance transfer cards could be one alright option when you’re searching for a way to consolidate your debts, but you need pretty decent credit to get the kind of card that will give you the most credit card relief. Secured lines could be used, but it’s not very likely that you’ll have the money to secure an additional line of credit as it is.
- Home equity credit lines will also unfortunately not be up for use if you don’t have a credit score of at least 650 to qualify and the only way you’ll get the best rates possible is if your credit score is closer to upwards of 740. There’s also only a very select few people out there who can afford a mortgage payment when they have bad credit, and you’re probably not one of those people. Why even take the chance with bringing on an additional mortgage payment if you don’t have to?
- Unsecured consolidation loans are almost a definite no when your credit score isn’t up to par. Banks make it a point to give those loans out to the cream of the crop: those borrowers with very good credit scores. But with it being the type of loan it is, even if you had a great score you’re not guaranteed to get approved for an unsecured consolidation loan from the bank.
Debt Relief Services Were Designed to Help You
When you’ve got bad credit, you’ll more than likely have to take to debt relief services to lighten your financial burden. While it’s the most aggressive form of credit card debt consolidation one can take on, it gives you the opportunity to face your creditors in good faith. Taking any form of action against your growing debt is better than trying to sweep it under the rug like it doesn’t exist. If you never pay back your creditors, they never make money off of you while they continue to tack interest on top of your growing balances, so you can trust and believe that they would much rather settle with you even if you’re trying to consolidate your bills. That way, they don’t feel like they’ve completely lost out on that profit and thus, they have no reason not to be open and responsive to your offers. You’ll be able to get better deals on your consolidation if you work through a debt relief service with experience and knowledge. Individuals that work for debt relief services are professionals that have had dealings with all of the major credit card companies: American Express, Bank of America, Capital One, Chase and Discover. They work hard to bring their clients the best possible deals and it’s clear that these debt relief services have strong relationships with these major credit card companies because of the continued business they both get that keep them in constant communication.
If you have $10,000 in debts to various credit card companies, you definitely won’t be able to afford the continuous interest, late fees and penalties that are stacked up on top of it all. Your debt relief professional will make it their business to negotiate directly with each of your creditors to have those late fees and penalties thrown out in addition to getting your balance and interest rates reduced down to a mere fraction of what it is you owed to begin with. Instead of making multiple payments to all of your creditors each month, you’ll instead have to make one single consolidated payment to your relief service.
When you decide to consolidate your bills, only those unsecured loans are eligible to be consolidated. It’s rare that a secured loan or federal student loan is cleared for consolidation.
Turn Your Credit Around
As you make your way through the motions of trying to consolidate your bills, your credit score will see a drop but as you pay off your credit card debts, you’ll see a rise again once the smoke has cleared and your accounts have been settled. Starting fresh with a debt balance at zero and a rejuvenated sense of responsibility will keep you on the right track heading forward into your financial future. Even if you’ve got really bad credit, you can get the help you need to consolidate your debt!