Best Debt Consolidation Companies – 2011 Predictions

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In 2011, the best debt consolidation companies will differentiate themselves from the rest by offering consumers both a real value and legitimate help. Ever since the housing crisis and ancillary financial meltdown, consumer debt has ballooned and become one of the most serious problems facing many individuals. While the assistance of a qualified counselor at a reputable company, you can begin to rebuild your credit and lower the total amount owed.The general concept of debt consolidation involves taking out a new, single loan that is used to repay many smaller loans. There are many advantages of this approach are many including a more convenient payment schedule, reduced total monthly payments, a lower interest rate, and often a longer payoff period. When one consolidates his or her debt with a debt consolidation company, the new lender will issue a single loan to pay off each of the loans being consolidated. The new loan will typically carry a lower interest rate and a longer payoff period which results in a lower monthly payment to service the one loan than the net amount needed to service all of the previously held loans. It is important to remember that, while the monthly payments are lower, you may end up paying more over the life of the new loan than you would have previously.The other big advantage is that because there is only one payment required per month, many borrowers find it more manageable to stay current on the current loan. The timing of the payment can be negotiated and set to suit the income of the borrower. The new lender is motivated to help you successfully service your debt.In the coming year, as the economy continues to improve, there is a heightened chance that interest rates will rise. This will make it more expensive to consolidate debt, decreasing the advantages. The best companies in this industry will still be able to offer comprehensive counseling and competitive terms, but the overall structure may have changed. Furthermore, as the government struggles to address the debt problem, and the increasing levels of default, it may become less advantageous to consolidate if legal changes are put in place to afford greater protection to lenders. In general, as soon as you realize that your debt has become unmanageable, consulting with an expert is the best way to start rebuilding your credit and getting the situation under control.