The Convenience of Online Debt Consolidation

Virtually any need can be dealt with online these days including arranging debt consolidation. Whether you are seeking to consolidate your debts via a home equity loan, a simple debt consolidation loan or by renegotiating your bills through a debt service, the internet can help find the debt consolidation company that’s right for you. Shopping for information online can make debt consolidation relatively quick and enormously convenient.

As with any credit related question, tracking your credit history is always the first place to start. Many people are not aware that the government has recently passed legislation mandating that a free credit report be made available annually to all consumers. It should come as no surprise, however, that these free reports are easily accessed online. Before applying for any sort of debt consolidation you should pull your credit history from all three credit reporting agencies and check them all for errors. Any mistakes should be immediately reported to all three agencies since they do not trade information.

You can also obtain your credit (FICO) score online for a nominal charge. The interest rates you pay for all types of credit are based largely on your FICO score. A score of 720 or better entitles you to the best rates. Scores of less than 580 and, in some cases, 600 are considered only fair or even sub par. People with scores below this mark will probably have higher interest rates on their online debt consolidation loans. If you are applying for a home equity loan as a method of debt consolidation other factors such as your income and the equity available in your home will also affect the interest rate you will pay.

Once you have determined your credit situation it is time to make a preliminary search for online debt consolidation sources. Filter your search according to the type of debt consolidation you have decided to seek. Choosing your search terms carefully will eliminate companies which do not meet your requirements or whose standards you do not fulfill.

Subject the online debt consolidation companies to the same scrutiny you would bricks and mortar companies. Most will have online applications which will determine if you are eligible for their programs. Other sites may serve as brokers who will submit your application to several companies which in turn will e-mail you with offers. Be selective about the companies to which you apply. Having a large numbers of requests for your credit information may sometimes be perceived negatively by the credit reporting agencies.

One of the advantages of making your applications for debt consolidation online is that you automatically receive all offers in writing. Print them out and go over each proposal line by line. Compare to each other the responses you like most like. Make sure you are always comparing apples to apples. Also, print out and read carefully any disclosure statements which are referenced by the companies.

If you are not completely satisfied with any of the offers contact the companies either by phone or e-mail. Let them know that you are dealing with several companies. They may then resubmit their proposals for online debt consolidation to you with adjusted terms. Continue the negotiation process until you receive an offer that meets your needs. Be firm but also be willing to modify your stance if necessary.

After you have completed the give and take process you will be required to sign your debt consolidation paperwork. Companies handle this in different ways. You may be asked to sign the papers in front of a notary and mail them back. Some online debt consolidation companies will have local representatives who will come to your home or office and handle the paperwork.

Once you have completed the online debt consolidation procedure, it is then up to you to use your credit in such a way that you don’t have to consolidate a second time.