Debt Bill Consolidation

Do you have six to ten bills a month? Wouldn’t be nice if you could lessen the bills you have in a month to just one?  It sounds great in theory and there are certain bills you can consolidate.  Debt bill consolidation is one way you can lower your interest rates and monthly payments on credit cards, auto loans, and mortgages.  However, you need to be smart regarding the debit bill consolidation. 

Utilities and medical bills are about the only thing you cannot consolidate into one loan.  How debt bill consolidation works is you have two or three credits cards, an auto loan, and a mortgage that you want to combine.  If you have the equity in your home, you could get a second mortgage.  This would leave you with two payments in a month.  A second option is to get an unsecured debt bill consolidation loan. 

The consolidation loan, which is the avenue most people can choose, will be a higher interest rate than a secondary mortgage or refinanced mortgage.  The reason for this is that you have no collateral to offer the debt consolidation company.  On the other hand, they will try to work a deal for the debt bill consolidation.  They will endeavor to get your balances reduced as much as possible.  The company pays off your creditors and gives you a loan.  You now owe the debt consolidation company.  They create a loan with one payment and a lower interest rate than what you were paying. 

With five or more bills of high interest, you are paying interest for each of those debts.  So even at 20 percent on your new loan you pay out less interest.  You are hoping of course that the new interest rate is closer to the FED rate.  The other good thing is that you have one payment, which should be less than the combined total of the other bills.  This means you get to save money through the debt bill consolidation.  This money can be applied to the loan you are now paying on or used for savings to build up your nest egg.