Debt Consolidation Loans for Bad Credit

by Gray Peters

“Consolidation” is term you hear all the time in the world of loans and financing, but you may not be aware of exactly what goes into debt consolidation loans for bad credit. Although I’ve never had the need to go through the process myself, I wanted to be able to put together a good article to let you know what you’ll be facing if your unsecured debts and credit cards become too much for you to handle.

In order to research this article I took the time to work through an application on one of the more popular debt consolidation sites, and here’s what I found:

First, they asked me a series of questions about my current financial situation and my debt. For example:

  • They wanted to know where I am with my monthly payments and other bills (can I keep everything current easily, are things getting tight, or are the creditors starting to ring my phone off the hook).
  • They wanted to know the main reason I’m looking for a debt consolidation loan with bad credit in the first place (unemployment or reduced employment, death or divorce of a spouse, unexpected increase in expenses…things like that).
  • Finally, they wanted to pull my credit report to see exactly where I am in terms of my debt and interest rates. I’m sure they take that information and plug it into a formula to determine whether I’m a good candidate for their program.

I’ll tell you that my general sense of this company, and of the debt consolidation industry in general, is that they really want to help people. They’re not the ones burying you in debt; they’re the ones trying to help you get out from under the debts you have. It’s nice to see that there’s a company in the financing industry that actually has people’s best interests in mind instead of trying to make them even worse off.

When you go through a debt consolidation program I would also strongly suggest that you take advantage of their credit counseling program. You got into a situation where you need a debt consolidation loan with bad credit due to lack of discipline, lack of education, bad circumstances, or probably a combination of all three. A good credit counseling and personal financial management course will protect you from ever having to go through something like this again.

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