Debt consolidation company recommendations please

Kruel J · Dec 9, 2024

Jay Walk said:
Home loans and consolidation just drag out the debt longer.
Don't do it.

You want to move it around or do you want to be done with it?

That's the choice.

The money has to come from somewhere and the cheaper the better. Money has been so expensive for so long nice to see rates moving down a little bit.

Koda · Dec 9, 2024

Joe13 said:
We are not behind on any payments and have been able to keep up which is why our credit is not in the toilet.

I'm 50/50 on whether or not I care more about the end result (ie ultimate cost) or the convenience of just having a single payment to make our bills easier to deal with.

Obviously I don't want to pay thousands that are unnecessary but if it is close then I would rather take the hit and have a single bill to track of.

Dont take out equity on your house to consolodate.

If your affording your payments you can pay off the debit using the snoball method. Double up on the smallest loan, when thats paid off add that payment to the next smallest loan. And so on. Its a proven method that works.

Kruel J · Dec 9, 2024

Koda said:
Dont take out equity on your house to consolodate.

If your affording your payments you can pay off the debit using the snoball method. Double up on the smallest loan, when thats paid off add that payment to the next smallest loan. And so on. Its a proven method that works.

Why not? Especially if the interest is better. Even with sparkly credit, cards are at basically 20%.

Debt is debt. Why not try to find the cheapest way to be in it?

Member 24198 · Dec 9, 2024

Koda said:
Dont take out equity on your house to consolodate.

If your affording your payments you can pay off the debit using the snoball method. Double up on the smallest loan, when thats paid off add that payment to the next smallest loan. And so on. Its a proven method that works.

Yes and no. I know Dave Ramsey likes this, but this method is purely psychological and you will pay more in interest. For many in a tough spot, making headway that they can see is necessary for the motivation.

Alexx1401 · Dec 9, 2024

Kruel J said:
Avoid the debt repair type places. They can get you lower payments but your credit takes a beating.

Those are again the "no free lunch". For people who have no home so no way to get really good points they can be great. A lot of the debt is just written off due to the people who are owed figuring better to get a percentage of it back rather than having the one who owes just write it all off. It does hit the credit score hard though because they are writing off a lot of what was owed them. Listening to some of the suggestions here I now see why so many end up with heavy debt load of VERY high interest debt even when they have easy ways out. What always seemed simple math to me must not be so simple after all

Koda · Dec 9, 2024

Kruel J said:
Why not? Especially if the interest is better. Even with sparkly credit, cards are at basically 20%.

Debt is debt. Why not try to find the cheapest way to be in it?

Because your home is an investment and borrowing against that reduces the investment. Its a very poor financial move. You want to pay your home off as early as possible.

Member 24198 · Dec 9, 2024

Kruel J said:
Why not? Especially if the interest is better. Even with sparkly credit, cards are at basically 20%.

Debt is debt. Why not try to find the cheapest way to be in it?

Never considered doing an equity loan, but does your interest stay the same? I imagine it comes with some fees.

Kruel J · Dec 9, 2024

The snowball method is great and can save some money in the long term but finding cheaper money is always the way to go. Even better of course is don't be in debt to begin with but life happens and I'm sure @Joe13 isn't here completely of his own doing.

Kruel J · Dec 9, 2024

Koda said:
Because your home is an investment and borrowing against that reduces the investment. Its a very poor financial move. You want to pay your home off as early as possible.

Paying off the house early with a pile of other debt doesn't make things any better.

Koda · Dec 9, 2024

solv3nt said:
Yes and no. I know Dave Ramsey likes this, but this method is purely psychological and you will pay more in interest. For many in a tough spot, making headway that they can see is necessary for the motivation.

You wont pay more intrest when you pay off the load entirely.
Credit card debt does not want you to ever pay off your bill, its rigged that way. Using the snowball method is designed to pay off the debt entirely, they hate that.

Alexx1401 · Dec 9, 2024

solv3nt said:
Yes and no. I know Dave Ramsey likes this, but this method is purely psychological and you will pay more in interest. For many in a tough spot, making headway that they can see is necessary for the motivation.

I would have to "guess" maybe he is scared that those who can take a FAR cheaper loan and just wash away the high interest "may" run up more high interest debt then? Since if you do it the smart way and wipe out that high interest stuff you would still have great credit. So those who offer cards would of course be trying to tempt you to take their stuff. Not sure how much of that really expensive debt is just walked away from but, banks loaning out money at rated that are 5 or 6 times the cost to them to get the money? They have to be making some bank from doing this.

Koda · Dec 9, 2024

Kruel J said:
Again, debt is debt. Paying off the house early with a pile of other debt doesn't make things any better.

Not true.
Extending your home load decreases the equity you make from it. Your literally borrowing against yourself.

Kruel J · Dec 9, 2024

Koda said:
Not true.
Extending your home load decreases the equity you make from it. Your literally borrowing against yourself.

If you aren't looking to sell it doesn't matter. Especially if you pay off your HELOC before you intend on selling.

Member 24198 · Dec 9, 2024

Koda said:
You wont pay more intrest when you pay off the load entirely.
Credit card debt does not want you to ever pay off your bill, its rigged that way. Using the snowball method is designed to pay off the debt entirely, they hate that.

The snowball method is paying off the smallest loans first, and going on to the next. This isn't the best way to pay off debt if you have the ability to pay more than the minimum.

Alexx1401 · Dec 9, 2024

Koda said:
Not true.
Extending your home load decreases the equity you make from it. Your literally borrowing against yourself.

Yes but if the choice is owe money to a bank at 20% or owe the same amount at 5% how is keeping the 20% loan a win??

Koda · Dec 9, 2024

solv3nt said:
The snowball method is paying off the smallest loans first, and going on to the next. This isn't the best way to pay off debt if you have the ability to pay more than the minimum.

Disagree.
Especially if you have the ability to pay more than the minimum.

Kruel J · Dec 9, 2024

Koda said:
Not true.
Extending your home load decreases the equity you make from it. Your literally borrowing against yourself.

Example: If you extend your home loan 25k in a heloc to pay off debt, how is that any different than selling your home and taking 25k off the top to pay off the debt? Debt is debt. Terms and interest rates are all that really apply here.