Is Debt Consolidation a Necessary Evil?

Most people feel ashamed that they are in debt with ruined credit history; they feel ashamed and alone. Those are regular folks, who feel they do not need debt consolidation. Others may not even realize that they have bad credit until they have gone to get a loan only to find out that they've been turned down. If you have ever been turned down for a loan or a credit card, most of the time it is because of your poor credit rating. debt consolidation loans

At this point, you need to ask yourself whether you want to go through debt consolidation or there are ways to repair your credit without it? debt consolidation loans

The answer is yes but it will be a long hard ride. Here are a couple of things that you can do to prevent a consolidation loan. debt consolidation loans


Pay Bills on Time
This may seem like a common sense thing to almost everyone, but it's a hard one to accomplish. With today's economy, being late even by one day can mean disaster to your credit rating. The credit card companies are just waiting to mount higher and higher interest rates and lower your credit limits. They can even add further restrictions on your card.

Pay on time
When your credit scores are calculated your payment history makes up about 30% of the total score. It can be raised point by point if you make your payments on time or even early. If you are using regular mail, you must give the payment plenty of time to arrive at its destination so that it is not late. Better yet, schedule automatic payments for most of your regular expenses - making sure, of course, there are funds in your account to cover the payments.

Don't close old accounts
This is a much debated topic lately among many people. With today's economy, it is hardly advisable to close out old accounts. This is especially true if you have a good reputation of paying on time on these accounts. Just having old accounts open isn't going to affect your credit score much, and may in fact improve it.
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So, no, you may not necessarily need debt consolidation, but it makes a good sense to use it to help you get yourself out of debt and improve their credit rating on the way.