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There area a couple of different things you could consider in the area of consolidating your debts.  Again, as we've said throughout this site, you are advised to consult your various advisors-accountant, financial planner, attorney before you make any decisions.

First, if you have good credit and an asset with equity, such as a house, you could take out a new mortgage or a second mortgage and wrap your bills/payments into one new loan.  Depending on your overall financial circumstances this may or may not be the best option.  Nonetheless, it is an option.  You can begin your online mortgage application from our mortgage site at Venture Development

Another option would be to take out a non-secured second line of credit or loan and wrap all the bills/payments into one.  Many people do this with student loans-they consolidate many little loans into a bigger loan with a longer repayment period and hopefully a lower interest rate. 

A THIRD, yet a more drastic option would might be to negotiate a settlement on your debt with the help of an attorney.  This is beyond my area of expertise, but is one of the things you might discuss with a bankruptcy attorney or an attorney that is familiar with this area of the law.  Making settlements with your creditors will probably have an impact on your credit score, as they will most likely close your account and report that the debt was settled for less than owed.  Debt forgiveness is generally a TAXABLE event.  Many people don't realize this until they receive something called a 1099C.  This is the form creditors will give you when you settle your debts for less than you originally owed.  Even if you don't receive the form, you must still report the income.  So, don't assume that you don't have to report the debt forgiveness if you don't get the form or you could be guilty of tax fraud.  You don't want to end up like the photo below-in a federal prison- below-MAKE SURE-you understand the income tax ramifications of all of your actions. 

Lower Payments By Settling or Consolidating Your Debt

It is not difficult for credit card and debt payments to get out of hand. Many people pay the minimum balance and in some cases that is enough to allow you to make a payment towards interest and one towards principle provided that your balances are kept small. However, the higher your balance and the longer that the balances remain on your card the higher the interest becomes, it does not take long for it to be impossible for you to pay off the principle as well as interest when paying just the minimum balance.

Even the minimum balance can become too much for people to pay. They become overwhelmed with their debt. There are a few ways to deal with this.

However, it should be dealt with as soon as possible before it gets out of hand and creates an issue for you and your credit. There are a number of options that can be considered when looking to create payments that are manageable under your budget. The first step is to create the budget, gather all your bills together and list all your payments and expenses.

Payments are listed for credit cards and other nonessentials, expenses are for things necessary to live and work such as car payment, car insurance and rent. Movie rentals, monthly subscriptions, eating out and so forth are not considered essential and if you are having difficulties paying essential bills, these should be eliminated. This increases the amount of overall income you have to work with, within the budget.

You can then budget this extra money into your debt payments. In some cases, you may find it difficult to manage this even with additional funds. This is where you may want to consider consolidate debt options such as unsecured credit card consolidation, secured credit card consolidation, a debt consolidation loan or credit card debt settlement options.

Choosing which way to go when you are looking to eliminate or reduce debt payments to a manageable level depend on the resources that you have available. For example, if you have a home you can consider three different options for a secured credit card consolidation or a debt consolidation loan. The first is placing a mortgage on your home if you have a home that is paid off. This will give you the money you need to consolidate your debt placing the balances under a payment that contains a significantly lower interest rate and has all payments tied into a single payment.

The second option is a refinance. This refinances a current mortgage. It should do two things for you. The first is that it should reduce the payments you make on your home. It does this in two ways. The first is that often times it is going to extend your loan. This means smaller payments. The second is that it is going to provide you with a lump sum of cash to work with. Use this lump sum to pay of credit card debt with a higher interest rate.

The third option is to take out a second mortgage or what is often called a home equity loan, this takes the difference between your home’s value and the value left on your mortgage and provides you with this amount as a lump sum or a line of credit. This does the same thing as a refinance but may mean a second house payment with a different interest rate.

An unsecured credit card loan is also an option if you still have a decent credit rating and you do not own your own home. This is basically a personal loan, which is taken out for the purpose of debt consolidation. The terms are going to be stricter and the interest rate is usually going to be higher than secured loans because there is an increased risk to the lending institution. However, this is going to provide you with a lump sum that will let you pay off your higher interest credit cards, place all the balances into a single payment and have an overall lower interest rate.

If you have gone beyond the point that consolidation is an option or consolidation options are not available to you there are credit card debt settlement options that are available under certain conditions. In these situations, there are usually two ways that debt settlements become available. The first is that you present a settlement offer to the credit card company in exchange for marking the debt paid in full.

The second is that the debt collection agency presents the offer and you accept. If you accept and make the lump sum payment the debt is settled and marked as paid in full. Debt settlement options involve negotiations and need to be carefully monitored. It is important to double check to make sure that the payment is recorded and the debt is reported as paid in full and reflected on your credit history.

There are usually three types of debt settlement options that are offered when a debt collection company presents its options to you. The first is going to be a lump sum. This is going to present you with the most discount.

Depending on how long the debt has been outstanding, this can be as much as 75% off the total of the bill. It can also be as little as 10% off. The size of the debt also factors into this.

The second option is going to be a short-term repayment schedule. This usually involves repaying the debt in several lump sum payments. The discount is less but the payments are smaller in the settlement. The third option is usually a repayment schedule that covers the entire amount of the loan. There is no discount on this third option. These are some of the major options that are available for individuals who are in need of debt consolidation and settlement options in order to reduce payments and eliminate debt.