The Student Debt Archives
The Federal Reserve, in their monthly report released Monday, noted that American credit card debt has reached a record high. The current amount of credit card debt owed by Americans […]
Federal student loans offer many benefits over private student loans. They typically offer decent fixed interest rates and flexible repayment options. After graduation, however, many people wonder if they should […]
College isn’t cheap these days. The average annual cost of attending a 4-year public college is currently $9,139. Twenty years ago, the cost was $4,426 when adjusted for inflation. But […]
What Is Student Loan Consolidation? Consolidation is the process of combining multiple loans into a single loan at a fixed rate. This rate is calculated using the weighted average […]
Editor’s Note: We are excited to announce the maiden voyage of The TBC Podcast, our informational blog designed to help everyday consumers make smarter decisions with their money! For this […]
- Takes your existing debt and try to settle with your creditors for a lower amount. If you pay off the settled amount, your debt will be considered paid in full.
- Negotiates with your creditors on your behalf.
- Fee based on a percentage of your total starting debt or a percentage of the debt they save you.
- Most settlement companies have you create a separate "escrow" account where you will make monthly contributions over a certain amount of time to contribute to your settlement. Once there is a substantial amount of funds to show your creditors, the settlement company will try to negotiate a lower amount of debt.
- Combines all your debts and creditors into one monthly payment.
- Allows you to pay one monthly payment to the consolidation company, instead of multiple payments to different creditors.
- You no longer owe your original creditors; instead you pay one monthly payment to your consolidation company.
- Consolidation companies can help negotiate lower interest rates on your debts and help lower your total debt payment in the long run. A lower interest rate will lower the amount you owe in the end.
- Allows you to consolidate all your different debts into one personal loan that can be paid off over time.
- Can offer borrowers a lower interest rate with a longer payback term (compared to high-interest credit cards or medical bills). This will lower the amount of money required to pay off the loan over time.
- Personal loan debt consolidation can be an effective way to raise your credit score quickly (within 3-6 months).
- Borrowers can receive funds from their loan within only a few days.
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