6 qualities to look for in the best Credit and Debt Consolidation Programs for 2018

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Life can be quite overwhelming when you are saddled with lots of debt from several creditors. It is best to find a loan program that can help you get your financial situation back on track, especially if you have several credit card balances and high-interest personal loans to pay. Rising debt can make your budget more uncomfortable because of countless repayment dates that you must adhere to. A debt consolidation program will be your best bet because it can help you get your credits organized while reducing your monthly repayments. Here are a few guidelines to choose the right Credit and Debt Consolidation Programs for 2018.

Reputation

When choosing a debt consolidation program, you must consider the reputation of the creditor you are dealing with. You need to find a debt consolidation company that meets the minimum qualifications and upholds set consumer financial laws. You can compare debt consolidation firms based on several factors such as employee certifications, compliance with the federal regulations, average consumer reviews and ratings.

BBB Rating

A good company should have an excellent rating with the Better Business Bureau (BBB). The BBB is a nonprofit organization that promotes ethical business behaviour and monitors compliance of their 400,000 accredited businesses. Consumers that wish to make more informed financial decisions when looking for the best debt consolidation companies can check out the BBB website. Here, they will be able to identify trustworthy firms and check out unbiased customer complaints and reviews on BBB.org.

Qualification

Most financial institutions that offer debt consolidation loans usually set requirements depending on the amount of debt that the client has before they request for the loan. In addition, they will also consider the types of debt that the client has, debt to income ratio, enough monthly income, and the borrower’s ability to meet their set financial obligations. Some companies will require you to only have unsecured loans like medical bills credit cards, and student loans. Irrespective of the company you settle for, they should have loan qualifications that suit your current financial circumstances.

Pricing and Fees

The essence of taking up a debt consolidation loan is to ensure that you have a loan that you can easily handle and pay off. Therefore, you need to avoid debt consolidation firms that offer expensive loan processing fees and pricing. A good company will openly disclose the basic aspects of their credit services such as the loan terms, the consumer fees for the service, and any other information regarding their loan pricing and fees. It is illegal for any debt settlement firm to misrepresent their services or make any false claims regarding what their services are meant to accomplish.

A variety of loan services

With debt consolidation, there is no one size fits all kind of loan. This is because different clients will have varying amounts of debt they want to consolidate and different financial abilities. You need a lender that will provide a wide variety of debt consolidation programs to choose from. This will ensure that you settle for a loan that perfectly suits your budget and financial needs to ensure you eliminate debt over time.

Fixed interest rates

Debt consolidation loans are available in both variable and fixed interest rates. With a fixed rate, you have a more stable option as you will have a monthly repayment that is predictable and safer because you will not have any surprises that you must instantly fit into your monthly budget. Always opt for a lender that offers a fixed interest rate for your loan as it will be more manageable and predictable and you will avoid any surprises.

Affordable payments

The major objective of combining several debts is to ensure that your loan repayment becomes more affordable and manageable. This is why you must ensure that you choose a debt consolidation company that offers you a better and more affordable monthly repayment option. Before you take up any loan, you must ensure that your monthly payments will perfectly fit into your budget. This is crucial because if you cannot afford the repayments, then you will end up inmore financial trouble in the future.

Late or unsuccessful payment charges

Some creditors may not charge you for late payment; however, there are those who will. Usually, late payment fees will include a blend of flat fees and a percentage of the loan amount, and you must pay special attention to the language used to explain these in the loan terms and conditions. Always opt for lenders with reasonable fees and an origination fee that does not exceed 6%, 5% of the entire monthly past due, and late repayment charges of less than $25.

Pre-payment charges

Be sure to check whether your creditor will charge you for making early monthly payments on your loan. This is important, especially if you want to clear your debt early. Most creditors will charge you for early repayment to make up for the interest charges that they lose when you pay the loan ahead of the scheduled date. Be sure to get lenders that do not offer a pre-payment charge.

Legitimacy

When looking for a creditor, you must ensure that you are getting a legitimate debt consolidation loan. This is because there are countless debt and credit consolidation scams in the market today. You must ensure that you get a loan from a legitimate financial institution. You should avoid creditors who ask you for an upfront fee in order to secure a loan. You should always trust your instincts and keep off programs or loans that do not seem right.

When your current debt becomes stressful to handle, it is best to always seek assistance to make your credit manageable. If you are searching for the best debt consolidation company, then it is crucial for you to shop around and check out various available options like balance transfer credit cards, credit card hardship programs, and personal loans. With a good credit score, you can significantly save on interest rates and be able to consolidate all your loans. Take time to compare at least several lenders before making your final decision. This way you will be able to get the best creditor who offers excellent loan terms and choose the right debt consolidation program.

Author Bio
Isabella Rossellini is a marketing and communication expert. She also serves as content developer with more than seven years of experience. She has previously covered an extensive range of topics in her posts, including debt consolidation and start-ups.