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For many people, the process of getting further and further into debt appears to be something they excel at. It typically starts with some kind of unfortunate incident, the kind of thing that is not planned and that you have little control over, like a major unexpected medical expense, being laid off from a job, and any number of something things. To keep your head above water while you are going through the situation or while you are looking for a new job, you max out your credit cards. Since your credit score has not tumbled significantly yet, maybe you open a couple new credit card accounts, and within a short period of time, they too become maxed out. As time goes on, you start to miss payments, and things start to go downhill in rapid fashion. The calls from the creditors are significantly less friendly, and after each creditor turns it over to their dreaded collections department, you discover the reality that those guys can be downright hostile, sounding like something straight out of Miami Vice when they call, definitely not friendly, and just barely keeping on the legal side of not making a direct threat. Long before things get to the point of the collections department, you need to be smart enough to see where things are going and investigate a bad debt consolidation loan. Contrary to popular belief, such loans are not only for "losers", but are used on a regular basis from savvy consumers all the time. Consider the logic of it. Say you have 10 accounts which are overdue. You are paying interest on each of those, and the interest rate you are paying is probably very high. What a bad debt consolidation loan will do is pay off those accounts, rolling them all into a single loan at a single interest rate. Now you are only paying interest ONCE instead of ten times, and the single payment you are making each month is lower than the sum total of the 10 individual payments you were making before. Your creditors are no longer hounding you, and your credit score has not gone into the dumpster. Do you see where this is actually a very smart move? Instead of doing a bad debt consolidation loan, some people in this situation seek out a lawyer to file bankruptcy. A good bankruptcy lawyer will examine your situation, and if possible, probably advise you to see a debt consolidation loan instead of filing bankruptcy. They probably will not collect their fee for that recommendation, but if that is your best option, I would hope they would mention it, since bankruptcy should only be considered as your very last resort due to the long-term negative effects. When you get your bad debt consolidation loan, the company will negotiate with your creditors and work out a payment schedule. As long as you make on time payments to the debt consolidation company, they will disburse funds to your creditors. This is different from a loan you would get from a loan company – with a loan from a loan company, you can do whatever you want with the funds, since it is up to you, and many people would NOT pay off their creditors but instead have a good time with the money. With a debt consolidation loan, they do not hand you a chunk of money but rather it's all on paper, and your payments to them turn into payments to your creditors. This type of loan makes incredible sense and can save your back side if you are drowning in debt, to give you the breathing room you need to get your head above water again. For more insights and additional information about Bad Debt Consolidation please visit our web site at http://www.debtconsolidationstrategies.com
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