Michigan Debt Consolidation Loans For Bad Credit

Debt consolidation loans from various financial institutions in Michigan are one option to consolidate debts. If the loan has better terms than the consumer debt getting consolidated then the result will be lower interest rates and lower debt payments. The problem usually is finding a debt consolidation loan that has more favorable rates. Doing so all most always requires the debtor to secure the loan with collateral. More often than not this collateral is a residence and the loan is a home mortgage.

An Unsecured Loan

If there is no collateral available or the debtor does not want to provide any then the only option is to get an unsecured loan. Unsecured loans with better interest rates and payment terms than standard “off the shelf” consumer debt can be very hard to find in Michigan, especially in today’s credit markets. If credit is not perfect then most likely only a subprime personal loan to consolidate debt will be available. This has a very low chance of improving the debtor’s financial situation and will most likely damage it.

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Michigan – Personal Loan to Consolidate Debt

Consolidation can affect the ability of the debtor to discharge debts in bankruptcy, so the decision to consolidate must be made carefully. Apart from relieving the borrower of the headache of haggling with numerous creditors, debt or bill consolidation also considerably reduces the monthly repayment bill.

There are two types of loans you can take out to cover all your debts. Depending on your situation, both can have a different set of advantages and consequences.

Secured Debt

Secured debt are called that as it involve a collateral. This means you take out a loan against the equity you have in the house you are staying in, your car, your land and so on. In the event that you fail to repay the loan borrowed, this collateral can be confiscated by your lender to be auction off in order to cover the loan.

As you can see, there is a huge consequences in losing your home or other valuable asset if you mismanage a secured loan. But the good news is, since your lender have some sort of security in hand, you are considered credit worthy and will likely score a lower interest loan.

It is possible that you are in so much debt that you are not eligible for another loan. In this situation, having some kind of collateral helps as you can have the option of taking out a secured loan.

Unsecured Debt

No collaterals are involved in a unsecured loan. An unsecured loan may be harder to obtain since you are already having bad credit record at this point. When you do get one, the interest is very likely to be higher than that of a secured loan. The allowed loan amount also will not be as high, but the risk involved is also lower.

You don't have to listen to what debt consolidation company tell you about your ability to get a loan and how you have to pay high interest to get one. Just obtain your own copy of your credit rating to know what you are eligible for. No matter which type of loan you choose, always make sure you can make full payment on time so your debt consolidation can work its way to make you debt free in the shortest time possible.


Earnest Loan Consolidation

Debt Consolidation And The Facts You Should Consider

Most Americans have a problem with debt; the fact that the average household owes nearly $10,000 on their credit cards makes that pretty clear. And with interest rates and minimum credit card payments rising, consumers are finding their bills harder to pay each month. In years past, those who cannot repay their bills would often resort to filing for bankruptcy.

But last year's Bankruptcy Abuse and Consumer Protection Act makes filing for bankruptcy more difficult and expensive than ever. What is someone with a debt problem to do? Credit counseling? Debt consolidation? Something else?

According to a new company that has been issuing press releases, the consumer can simply walk away from his or her debt. That's right, just walk away without repaying. The details are vague, of course, and won't be spelled out until you actually pay them for their services. But the company, which shall remain nameless, states that U.S. banking laws actually prohibit the lending of money at interest and that "several U.S. Supreme Court decisions" have backed this up. So, they claim, you don't have to repay because your creditors were not legally permitted to issue credit to you in the first place!

For a fee, of course, this company will advise you as to how you can walk away from your debts without having to repay a penny. Even more incredibly, they also promise that doing so will not negatively affect your credit report.

The Supreme Court has probably had plenty to say about credit and lending over the years, but they almost certainly have not said that consumers have the right to elect not to pay their bills, which are subject to a legal contract to which the debtor has agreed. And the credit bureaus will certainly treat failure to pay in this scheme just like any other occasion when someone doesn't pay - they will mark it as a delinquency on the debtor's credit report.

If it sounds too good to be true, it almost certainly is, and that certainly applies here. There is no "legal secret" that will allow a debtor to simply walk away from debt unscathed. And if you do have a debt problem, the last thing you need to do with your money is to give it to someone who will give you bad advice.

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