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How to do Debt Consolidation

Doing a business? And you have taken a lot of loans on your part in different times? Now confused about how to pay back all these debts? If these all your problems and you are in search of a simple answer rather solution to these; here it is. In these situations you have to go for a debt consolidation. But wait what it is and what is its precise procedure with different options are given you here. Ponder upon these and then plan a stepwise mechanism to undergo this whole process.

The stepwise procedure is as follows

1. Add up all the debt amounts on you including the interests on you. Also include those small amounts that you have forgotten or are less in amount.

2. Now decided that you want to go for a secure or unsecured larger debt. Considering the advantages and disadvantages, a secured debt is far better because of a lesser and fixed payment interest. If you have a bad credit score and going towards the bankruptcy, it& 8217;ll be difficult to have an unsecured loan because of decrease in credibility and a bad credit report.

3. Think about all the available options that can be applied as a parallel option for receiving of loan. Like, you can take a loan in equity to your house. This resembles selling of a house on its price but with a promise that you& 8217;ll pay back the price soon to have your own property. This gives you the best results with the minimum possible interest.

4. Another option is cash-out refinancing. That means you sell your house for money more than you owe, use that money in paying your loans. And the extra amount of payment is a debt on you with a least amount of interest.

5. You can also refinance your car and then have a loan on its equity so as to pay back all of the smaller loans. This also offers a small amount of interest.

6. Along with these you can apply anytime for a personal bigger loan. This is the unsecured type of loan with least advantages as due to a bad credit report they will ask for a huge amount in the name of interest. This is an open big debt with many side effects.

7. As you are in a danger situation so leave no stone unturned to negotiate and convince the creditor on your terms. He may consider your credit score and threat to be bankrupted as a request and lessen your interest rate and payment amounts.

8. If you still find this process complicated one, many credit consolidation companies are working in the market. You can hire their services for a reasonable cost to provide you with the debt consolidation. They will work in a more professional way and have a feasible and trust worthy co-operation to work with.