Using A Debt Consolidation Calculator

2007-03-08 10:33:40

( Financial )



Paying bills can be an agonizing experience. It is difficult to turn over your hard-earned cash to your creditors – especially if your income barely covers your debts.

If your life is an endless struggle to pay extensive bills with little room for personal luxuries, you should seriously consider applying for a debt consolidation loan.

What is A Consolidation Loan?

A consolidation loan allows you to reduce the number of payments you have to pay each month. Basically, your bills are consolidated into one monthly payment. The proceeds of the consolidation loan will pay off your remaining bills, and you are now obliged to pay only one loan.

Otherwise known as debt consolidation, a consolidation loan may lower your monthly payment, but consequently, also prolong your repayment period.

A debt consolidation company can help you with this process by negotiating with your creditors, often bargaining for a decrease in interest rates. Most creditors readily consent to this arrangement because they prefer to lower the rates over not getting paid at all. Some creditors are even desperate enough to waive the interest of your debts, in exchange for the opportunity to collect payments.

What is An Online Debt Consolidation Calculator?

Before applying for a consolidation loan, it is important to carefully evaluate your options. Ask yourself these questions: How much money can I save by getting a debt consolidation? How long will I have to keep paying?

An online debt consolidation calculator will give you the answers you need. By considering the total amount of your current debts as well as your outstanding charges, a consolidation calculator can effectively compute:

- how long it will take you to pay off the consolidation loan
- how much you need to pay each month for the consolidation loan
- how much money you can save each month through debt reduction

Additionally, an online debt consolidation calculator can help you choose from a number of repayment options offered by any debt consolidation company. By reviewing the numbers, you will have a clearer perspective about the direction you should take.

Please bear in mind, however, that these calculations are mere estimates of the actual figures. You may use the debt consolidation calculator to evaluate the potential outcome of getting a consolidation loan, but do not rely on the numbers as absolute facts.


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