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Debt consolidation loans: To choose or not to choose

On Behalf of | Oct 31, 2016 | Debt Consolidation |

One minute, you might feel “on top of the world” where your finances are concerned, only to take a plummeting dive when various circumstances or predicaments arise that not only chip away at your savings and general cash flow, but leave you financially devastated and at risk for losing your most valuable assets. When faced with such challenges, you might wonder where to turn for support, or how to determine whether certain debt relief options are within your best interests. Whether you live in California or another state, arming yourself with updated information and appropriate legal clarification may help you get back on financially stable ground.

Is a debt consolidation loan a viable option?

Don’t be fooled into thinking that a debt consolidation loan provides sudden, complete debt relief. Basically, it simply means you will take out a larger loan to consolidate all your current debts into one lump sum and payment plan. You might want to discuss the issue with an experienced debt relief attorney, who can help you explore factors of consideration, such as the following, to determine if this form of debt relief is right for you:

  • Steady income: Since you’d be taking out a loan, you’d have to show proof that your income would provide means for making payments on time.
  • Good credit score: Credit history is typically checked before loans are granted.
  • Equity: Generally speaking, the larger the loan, the more equity needed.

While these may not be the only factors lenders consider when deciding whether to loan you money, they are common issues addressed in such circumstances.

Facing serious debt can really put a damper on your ability to relax and enjoy life. It’s only natural that you’d want to weigh all your options to resolve your financial problems as swiftly as possible. As far as a debt consolidation loan is concerned, you might think the following potential benefits are good reasons to obtain one:

No more annoying creditor calls: This type of loan allows you to pay off outstanding balances, thereby eliminating those irritating daily calls from creditors, hounding you about money you owe them.

  • Lower interest rates: Rather than paying exorbitant interest on maxed-out credit cards, you can save money in the long run by taking a loan at a lower interest rate.
  • One payment only: You can save a lot of hassle by making a single payment to one source.
  • Lower monthly payment: You’ll most likely be granted a longer time to pay off your consolidated debt loan, thereby allowing smaller payments each month.

Studies show financial debt is one of the largest contributing factors toward stress. The potential benefits of a debt consolidation loan or other type of debt relief might help you avoid unhealthy stress and allow you to focus your attention on the things you enjoy most in life.

When legal trouble arises because of debt situations

If you have been feeling overwhelmed and as though your life is slowly crumbling around you due to serious financial debt, you are not alone. Many people have lost their jobs, marriages and lifetime savings due to financial trouble. You may have been tempted to or have already accepted financial assistance from questionable sources, only to find out later that problems have grown worse, not better.

Rather than panic, you can remain calm and reach out to an experienced advocate who understands all aspects of bankruptcy, bad loans and other debt situations. You needn’t feel hopeless when a strong support network is available to help you get your life back on track and free from financial crisis.