TOP Questions And Answers About Debt Consolidation
Debt Consolidation Clearwater, FL
When you are struggling with debt in your life, you may need help with debt consolidation Clearwater, FL offers with the aid of The Ziegler Diamond Law, P.L. We understand that you may have no idea how bad your debt is until you are too far into it. If this is the case, getting out on your own may be extremely difficult or nearly impossible. However, getting help from the Clearwater, Florida debt consolidation attorneys at our office can be a huge asset to you. The economy is always changing and we believe that everyone deserves the opportunity to fix their debt. If you have any questions regarding debt consolidation or if you would like to set up your initial consultation with a member of our office, give us a call. We believe we can help you with your debt consolidation.
What is debt consolidation?
This is one of the most common questions we get asked when a client comes to us asking for help with their debt. Debt consolidation is actually pretty simple. When you have different debts you have to repay and you create a debt repayment plan, you can consolidate multiple payments into one payment every month. Usually, you can do this with a lower interest rate and other benefits as well. When you work with our Clearwater, Florida debt consolidation attorneys, we will go over all of the benefits that debt consolidation can offer you.
Are there different types of debt consolidation in Clearwater, FL?
You will typically hear of two different types:
- Debt Management Plan. When you pursue a DMP, you can usually get different benefits like lower monthly payments, late fee waivers, and lower interest rates.
- Settlement Plan. If you are unable to afford monthly payments with a DMP, you may be able to work with a settlement plan (instead of filing for bankruptcy).
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We are there for our clients when they feel that they have nowhere else to turn to. When you are in a serious amount of debt, you may think that your only option is bankruptcy. While bankruptcy may be right for you, debt consolidation may help as well.
Why work with an attorney?
Understandably, you may be wondering why you should work with an attorney when it comes to debt consolidation and relief instead of working with someone in finance. The truth is, debt consolidation can be just as much a legal issue as it is a financial issue. Similar to insurance agents, debt collection agencies don’t expect you to have the right negotiating skills when it comes to your debt. They will be ruthless and try every trick they can to wear you down so that you will pay them. When you think of debt with a creditor, however, it is, at its core, a contract between you and another party. Because owing a debt could be considered a breach in your contract, it can become a legal issue. When this is the case, you want an attorney who will represent you and who specializes in financial problems.
Shouldn’t I just declare bankruptcy?
Not necessarily. Bankruptcy can be a good option for many people. However, we consider it a last resort and it is not a situation to enter into lightly. Always speak with your debt consolidation attorney before making the decision to enter into bankruptcy.
What kinds of debts can be consolidated?
When you are wondering what kinds of debts can be consolidated, you will likely be looking at the following types of unsecured debt:
- Student loan debt
- Credit card debt
- Any medical bills you may have
Is it possible to undergo debt consolidation on my own? Do I need an attorney?
You are not required to have an attorney. However, if you are looking for ways to maximize what you can get out of debt consolidation, working with an attorney may be the best option for you. Especially when it comes to your finances, you want to be set for the future and get out of risky situations. Having an attorney on your side who can explain the debt consolidation process to you and help you make decisions can be the key to understanding how to get out of your difficult financial situation.
Debt consolidation or bankruptcy?
When you are trying to determine if debt consolidation is right for you, you may also be looking into whether you should declare bankruptcy. We have been here for many clients who are forced to make tough decisions because of the debt in their lives and we want this to be a clear decision for you. There are many debt management strategies out there and these are two of the more popular options you can choose from and one of them may clearly be right for you. If you would like to learn more about why one may be better than the other, please give our office a call.
What are the pros of debt consolidation?
There are certainly some advantages to debt consolidation. These are:
- It helps you to simplify. When you are swimming in debt, simplifying can be one of the best options. Consolidating your debt means you do not have to focus on multiple different payments, different agencies, and different interest amounts adding up.
- It can lower your monthly interest rate. When you choose to consolidate your debt, you may be able to lock in a better interest rate which means you will have cheaper payments in the long run. This can help you get more cash in your pocket every month for things you need.
- You may be able to keep your credit cards. In certain scenarios, you may not be able to have access to your credit cards when it comes to the debt consolidation agreement. Whether it is the right decision to continue using credit is something you should speak with your lawyer about.
- You may be less embarrassed. Understandably, many people are concerned that filing for bankruptcy may ruin their reputation. Debt consolidation does not have the same kind of stigma that filing for bankruptcy does.
What are the pros of bankruptcy?
There are pros that come with bankruptcy as well.
- Protection from creditors. Filing for bankruptcy means that you have protection from creditors through an automatic stay. This can be very important when collectors are harassing you. Unless they get a court order, they are no longer able to file lawsuits or repossess your items.
- You may get the clean slate you need. When you file for bankruptcy, it is possible to have all of your unsecured debt wiped out. This can allow you to get a fresh start and begin rebuilding your life.
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As you consider Clearwater, FL debt consolidation, you may be wondering how this will affect your credit score. The idea of debt consolidation makes sense: when you combine multiple debts together and get a lower interest rate, you should be able to pay off your debts faster and pay off less in the long run. However, as you begin planning to rebuild your life after you have been in debt, you probably want to know where you stand with your credit. It takes good credit to do many things in life, including getting a house, a car, or getting higher limits on your credit cards. So, you probably want to know how consolidating your debt will help you with your credit and pay off your debt. Here are a few things to know about debt consolidation and credit scores.
Ways Debt Consolidation Can Help Your Credit Score
- Diversification. It’s true, you may not be too concerned with diversifying your lending profile right now. However, if you take out a personal loan to consolidate your debt, it adds a new kind of credit to your profile which can help with your debt.
- Continued payments. As long as you are on time paying for your new loan payments every month, this will do wonders for improving your credit score. It’s important to remember that one of the best things you can do for your credit score is to pay off your debts on time.
- You make changes. One of the simplest things you can do is change the way you spend when you consolidate your credit debt. When you make these habit changes, you will not accumulate more debt.
Ways Debt Consolidation Can Hurt Your Credit
It is important to remember that you should work with an attorney when choosing to consolidate debt because they will help you weigh the pros and cons in determining if this is right for you. If you aren’t careful, debt consolidation can hurt your credit score.
- You don’t make your payments. When you still aren’t making your payments on time and you are over 30 days later to make payments on your new loans, your credit score will go down.
- You keep applying for loans. If you continually apply for loans and are unable to get them, these credit inquiries can start lowering your score.
Want to learn more? Reach out to us now.
How can a debt consolidation lawyer in Clearwater, Florida help me?
You may be wondering if you can do this on your own. While it is possible, we urge you to contact our office to find out ways working with us can benefit you. We will speak with debt collectors on your behalf and work hard to get you the plan that works best for your situation.
If you would like to learn more about Clearwater, Florida debt consolidation and speak with an attorney from our office, call The Ziegler Diamond Law, P.L.
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Clearwater: (727) 538-4188 | Tampa: (813) 225-3111