Tweet

Three Pros of Debt Consolidation

Written by: Joseph Lizio

Article Overview: Improving your credit by taking control of your debt can have a dramatically positive impact on both your personal life and your business. Here are some the benefits.

Three Pros of Debt Consolidation

Unsecured debt in this country has run rapid over the last few decades. Easy access to credit (mostly credit cards) and effortless payment options at retailers has helped propel this growing trend. If managed properly, this issue should not have an overly negative impact on individual household finances or on our country as a whole. One of the most important aspects of credit is that individuals or businesses can leverage continued and ongoing income to make purchases now that normally would take years to save for.

But, over the last 18 months of so, high individual debt burdens have not only place too large a weight on declining personal income but has adversely effect our economy at large.

Further, large personal unsecure debt balances also dramatically reduce credit scores making it nearly impossible to secure other types of financing like home mortgages, automobile loans or durable goods purchases.

While nearly all banks and other financial institutions have tightened their lending policies, they continuously state that while they do want to make loans to small businesses, they are not seeing very many qualified borrowers (mostly due to credit issues).

There are several avenues for both business owners and individuals to improve their credit; like consumer credit counseling or bankruptcy, but most are extremely long term and do much more harm in the beginning than they do in helping current situations - with one exception: Debt Consolidation.

The following outlines three pro of debt consolidation:

1) Lower your overall payments - combine your unsecured debt into one, low, affordable monthly payment making it easier to manage current debt payments.

2) Free up personal cash flow -reducing your current outlays means more money each month that can be spent on other needed items like rent, food and other necessities for daily living or business growth.

3) Improve your credit score - all credit scores are predicated on the ability to manage credit. By consolidating debt, making payments on time and accelerating the reduction of outstanding principal demonstrates, above all else, an individual's ability to manage credit.

Therefore, if you or your business is looking to improve your current situation, access additional credit and improve your life or your company - then debt consolidation may be your answer. Getting your debt under control and improving your credit can better position you for the new opportunities that are lingering on the near horizon - but you have to act now.

Take control of your unsecured debt and take back control of your life!

Related Articles
  How Does Debt Consolidation Affect Credit?
  Debt Consolidation and Refinancing – Is it Right for You?
  Consolidation Debt Management Money
  Debt Consolidation A Top Rated Home Based Business
  An outlook on the future of Debt Consolidation Companies

Article Tags: Three Pros of Debt Consolidation



Related Forum Posts
Re: Are Economic Recessions Good for Franchising? - All we can do is remain wide awake and pay attention to the ebb and flow. My strategy is to be prepared and go with the flow. There could be some rough times ahead... Interestingly, our business has remained strong. I believe it's because we're in such a tight little niche and we're well positioned to sign jobs nationwide, therefore we're not restricted to location. We also target affluent markets that have higher disposable incomes - this we do locally. Here are some Franchise Categories that could weather a good recession... Health and Personal Care Food services like Subway Debt Collection Tax Preparers & Advisors Any other recession proof franchise opps out there?
Getting something for nothing? - This is a tough one because it's hard to get something for nothing. There are two forms of financing - equity and debt. Equity is when you give up a part of your company / invention / idea in return for money or services. Hopefully the person you are bringing on is someone you can work with because you are now partnered until you sell or close down the company or buy each other out. Debt is when you borrow money so you aren't giving up a piece of your company but you have to pay the money that you are borrowing back. If you have a solid credit history or tangible assets then you can get it from the bank. If you don't have either then you can get private money but the interest rates will be higher (10% or more). Since every month you'll have to make payments you'll have to think about how long it will take you to start bringing money into your business from your invention. Either way you're giving up something in return for the financial help.The only other options I can think of are government grants that you don't have to pay back or befriending people who want to help you because they like you and by doing so they are being rewarded (very hard to find!) Good luck!


Share this article with your friends. Fund someone's dream.

Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.

Tweet

Newsletter

Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!

Name:
Email:

Popular Articles

Leading from Authenticity is a Beautiful Thing

Igniting Your Unstoppable Business Destiny

Your Local Small Business Online Marketing Funnel

Suggestions

Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.