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Debt Consolidation in Richmond Hill

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Richmond Hill Credit Counseling Process

York Credit Services is a licensed credit service provider in Richmond Hill. We provide a variety of financial and credit services to individuals and businesses as well. We are a team of financial experts with a lot of experience and knowledge in handling matters of credit counseling and debt relief. If you are having a hard time managing your finances, paying your debts and creating a budget that you can stick to, you should consider credit counseling.

Richmond Hill credit counseling is an informative process that aims to empower individuals to make sound financial decisions and to improve their financial status. With the current state of economy, it comes as no surprise that many adults are finding themselves in tough positions financially. With so many payments to make at the end of the month it is quite possible to fall back on a few or have barely enough money left for any other activities after clearing your bills.

Credit counseling is a part of any financial debt management program. As a Richmond Hill debt relief specialist, we have come to understand that it is important not only to eliminate the debt but also to inform the individual in order to avoid getting into future debt. Measures such as debt management programs or Richmond Hill debt consolidation can only work when one understands their personal responsibility in the process. And these include doing things like changing your spending habits, avoiding spending on credit and so on.

Debt Consolidation Loan

Are you looking for an easier way to manage debt? Consider taking a debt consolidation loan. This type of loan is offered by banks, credit unions, and finance companies to help individuals tackle their debt by having one payment only each month. With just one due date, you have low chances of missing payments or incurring late payment fees which lower your credit score. Additionally, if you qualify for a debt consolidation loan, you are likely to get lower interest rates which means more affordable financing options.

A debt consolidation loan may also give you significantly lower monthly payments compared to the cumulative payments you make to multiple creditors each month. This will relieve the financial burden you may be experiencing that’s putting you into further debt. Unlike other debt consolidation alternatives, this loan usually has little inherent risk of credit damage. Should you fall behind the required payments, the loan allows you to reduce the monthly debt service costs
which could have a positive impact on your credit rating in the long run. However, some loans have prepayment penalties which makes it extremely costly to take this option. You may also struggle to qualify for this loan if you don’t have any collateral.

A second mortgage is secured by your home which means you’re able to borrow a significant amount to offset multiple debts. You can borrow up to 80% of your home’s value and benefit from a low-interest rate compared to other types of debt. Since you’re securing the loan with your home as collateral, you reduce the risk for your lender which is what allows you to qualify for the low-interest rate. In fact, most banks offer second mortgages at single-digit interest rates. If you have credit card balances that attract huge interest fees, this could be an ideal option for you.

Drawbacks of second mortgages

By taking a second mortgage, you put your home on the line. Should anything happen and cause you to stop making payments, your home may be taken through foreclosure. Additionally, second mortgages can be very expensive because of all the closing costs involved. You’ll need to pay for things like credit checks and appraisals when the loan is processed. Keep in mind that the second mortgage interest rates are likely to be higher than your first loan’s rate. This is because the second lender is taking more risk than was the case during the initial transaction. This second lender may never get paid if you stop making payments until the first lender gets all their money back.

Have you ever considered taking an overdraft on your checking account? This form of financing is often given by banks to allow their customers to cater for emergency situations when their account runs out of cash. When you access a line of credit, expect to pay lower interest fees than what is charged on standard credit cards depending on your credit rating. You’ll be required to make minimum monthly payments to cater for the line of credit or overdraft.

If you get used to overdraft lines of credit, you may end up spending more paying it back than you should thus getting into further debt. Some banks will even deny you the access to overdrafts if they notice you borrow too much. Most banks don’t offer strict limits as to how often you can use the lines of credit. The limit given will depend on your credit rating and how much you qualify for. Before you choose to take this route as a debt consolidation method, consider setting up a transfer from your own savings account.

Do you often dread every time bills arrive at your home? Do you find yourself panicking when the phone rings with an unknown number? One tactic you can take advantage of to get out of debt faster is shifting your credit card debts into one card with a lower interest rate. If you owe lots of creditors small amounts, taking a loan to pay them off could be a viable option that makes your debt more manageable. Balance transfers are only ideal when you have credit card debt.

When you approach your bank or credit union, they can give you a balance transfer offer with low fees or even a 0% APR introductory rate. This means that initially when you take the loan, you will be required to pay little if any interest since there’s a grace period. As soon as the grace period ends, you’ll get back to paying the standard amount, which is usually much higher than the introductory rate. If you are considering this option, understand the terms and conditions of
the balance transfer such as how much you will be expected to pay each month once the introductory period ends.

A debt management program also allows you to make a single payment every month which simplifies the process of tracking your debt. However, the payment is made to the credit counseling organization which will then forward it to the respective creditors. Not everyone qualifies for a debt management program because the creditors must agree to it before you move forward. Sometimes the creditors refuse to agree because it means that you will pay off the credit with low or no interest rate.

A debt management program can have a negative effect on your credit rating. It can be extremely difficult for you to qualify for any form of financing until two years after you finish the program. Your credit counselor will begin the process by coming up with a proposal that shows your creditors why you are fit for the program. Any creditors who don’t agree will not be part of the program. We understand how overwhelming the process of consolidating debt can be. If you need help figuring out what’s right for you, speak to our expert today. We are happy to help you find out what options are available for your unique situation.

+ Debt Consolidation Loan

Are you looking for an easier way to manage debt? Consider taking a debt consolidation loan. This type of loan is offered by banks, credit unions, and finance companies to help individuals tackle their debt by having one payment only each month. With just one due date, you have low chances of missing payments or incurring late payment fees which lower your credit score. Additionally, if you qualify for a debt consolidation loan, you are likely to get lower interest rates which means more affordable financing options.

A debt consolidation loan may also give you significantly lower monthly payments compared to the cumulative payments you make to multiple creditors each month. This will relieve the financial burden you may be experiencing that’s putting you into further debt. Unlike other debt consolidation alternatives, this loan usually has little inherent risk of credit damage. Should you fall behind the required payments, the loan allows you to reduce the monthly debt service costs
which could have a positive impact on your credit rating in the long run. However, some loans have prepayment penalties which makes it extremely costly to take this option. You may also struggle to qualify for this loan if you don’t have any collateral.

+ Second mortgages

A second mortgage is secured by your home which means you’re able to borrow a significant amount to offset multiple debts. You can borrow up to 80% of your home’s value and benefit from a low-interest rate compared to other types of debt. Since you’re securing the loan with your home as collateral, you reduce the risk for your lender which is what allows you to qualify for the low-interest rate. In fact, most banks offer second mortgages at single-digit interest rates. If you have credit card balances that attract huge interest fees, this could be an ideal option for you.

Drawbacks of second mortgages

By taking a second mortgage, you put your home on the line. Should anything happen and cause you to stop making payments, your home may be taken through foreclosure. Additionally, second mortgages can be very expensive because of all the closing costs involved. You’ll need to pay for things like credit checks and appraisals when the loan is processed. Keep in mind that the second mortgage interest rates are likely to be higher than your first loan’s rate. This is because the second lender is taking more risk than was the case during the initial transaction. This second lender may never get paid if you stop making payments until the first lender gets all their money back.

+ Line of credit or overdrafts

Have you ever considered taking an overdraft on your checking account? This form of financing is often given by banks to allow their customers to cater for emergency situations when their account runs out of cash. When you access a line of credit, expect to pay lower interest fees than what is charged on standard credit cards depending on your credit rating. You’ll be required to make minimum monthly payments to cater for the line of credit or overdraft.

If you get used to overdraft lines of credit, you may end up spending more paying it back than you should thus getting into further debt. Some banks will even deny you the access to overdrafts if they notice you borrow too much. Most banks don’t offer strict limits as to how often you can use the lines of credit. The limit given will depend on your credit rating and how much you qualify for. Before you choose to take this route as a debt consolidation method, consider setting up a transfer from your own savings account.

+ Credit cards

Do you often dread every time bills arrive at your home? Do you find yourself panicking when the phone rings with an unknown number? One tactic you can take advantage of to get out of debt faster is shifting your credit card debts into one card with a lower interest rate. If you owe lots of creditors small amounts, taking a loan to pay them off could be a viable option that makes your debt more manageable. Balance transfers are only ideal when you have credit card debt.

When you approach your bank or credit union, they can give you a balance transfer offer with low fees or even a 0% APR introductory rate. This means that initially when you take the loan, you will be required to pay little if any interest since there’s a grace period. As soon as the grace period ends, you’ll get back to paying the standard amount, which is usually much higher than the introductory rate. If you are considering this option, understand the terms and conditions of
the balance transfer such as how much you will be expected to pay each month once the introductory period ends.

+ Debt management program

A debt management program also allows you to make a single payment every month which simplifies the process of tracking your debt. However, the payment is made to the credit counseling organization which will then forward it to the respective creditors. Not everyone qualifies for a debt management program because the creditors must agree to it before you move forward. Sometimes the creditors refuse to agree because it means that you will pay off the credit with low or no interest rate.

A debt management program can have a negative effect on your credit rating. It can be extremely difficult for you to qualify for any form of financing until two years after you finish the program. Your credit counselor will begin the process by coming up with a proposal that shows your creditors why you are fit for the program. Any creditors who don’t agree will not be part of the program. We understand how overwhelming the process of consolidating debt can be. If you need help figuring out what’s right for you, speak to our expert today. We are happy to help you find out what options are available for your unique situation.

The credit counseling process

If you have decided to get onto credit counseling, you will need to prepare some information that you would need to provide during your first meeting with a credit counselor, in order to make the most of the counseling session. This is basically most of your financial information for at least the past 6 months to a year. The information that you should expect the credit counselor to ask for includes:

  • All your monthly income sources
  • All of your expenses including utilities clothing food and any other miscellaneous expenses
  • Any recent credit card statements
  • Any recent communication you’ve had with any kind of debt collector or the IRS
  • It also helps to have a list of questions that you would like to ask the counselor ready
  • You can also list down your specific financial goals

Once you have all this information at hand then the credit counseling process can kick off immediately you find a debt counselor. You can choose to have face-to-face consultation with our credit counselors or you can have an online session. We also take phone calls and are always available in case you want to call in.

What to expect from the credit counselor

During the credit counseling session our credit counselors will first like to determine your current financial situation, especially keeping mind your current expenses, debt and income. We also like to review your credit reports during this first consultation. It gives a clear picture of your situation and allows them to give informative advice. After discussing your financial documents and the questions you may have for the counselor, they will advise you on the financial goals of the process, which normally include improving your credit, getting out of debt, saving for emergencies, funding your retirement and even buying a home or a new car. At York Credit Services, once we have laid down your financial goals we’re committed to ensuring that you achieve this goals by providing you with all the information and tools necessary to meet the requirements of the process. One of the ways you can do this is by developing a budget and an action plan.

Creating a plan

Our knowledgeable credit counselors will work together with you to create a budget and an action plan that will guide the entire process to achieving your financial goals. Depending on your level of debt, at this point you may discuss solutions such as filing for bankruptcy, consumer proposal, getting a debt consolidation loan or getting into a debt management plan.

One thing that is important in this entire process is you committing to do your best and allowing us to implement our recommendations accordingly. Once everybody is on board with the budget and action plan, we can start implementation.

Benefits of credit counseling with York Credit Services

Credit counseling has quite a number of benefits. Not only is the process informative and can equip you to pay off debt, credit counseling also helps you to maintain a good credit score. Good credit is essential to getting loans with good interest rates. Ultimately, the credit counseling process leads to better financial management because you really receive significant advice on budgeting and managing your financial stability; in the end you will learn how to manage your income and allocate your finances according to your attention needs.

“We are committed to reducing your debt and getting you back on the right financial track.”

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