| Debt consolidation glossary - A must read (debt consolidation)
|
| ACS provides free articles on credit counseling, debt consolidation loans and refinance mortgage. |
Debt consolidation glossary - A must read
[ Bookmark this page! ] [ get HTML Version ]
There are two different types of bankruptcy as they exist today - liquidation to clear you off on all your debt and second is re-organization in which you disclose on how you propose to pay off debt. However, before filing for bankruptcy you have to undergo mandatory credit counseling in the past sixty days. Credit counseling can be your way out. Additionally, debt consolidation can help you consolidate all your existing debts and give you a respite while you look around and rethink on viable options on paying back the debt. Below are some of the most common glossary words you will come across for credit counseling, debt consolidation and bankruptcy.
Debt consolidation - How to avoid the trap
To consolidate debt is a great idea with a trap built into it. The technique described here helps everyone in debt, but if you have an ongoing credit card debt you desperately need this article. * Part I Don't get into debt. Ways to avoid it. * Part II The big advantages of student loan consolidation * Part III This article -------- The Trap ... Read debt consolidation article
Debt consolidation glossary - A must read
Bankruptcy - Having been legally declared financially insolvent. There are two types of bankruptcy - liquidation, in which your debts are cleared (discharged) and reorganization, in which you provide the court with a plan for how you intend to repay your debts.
Collateral - Property acceptable as security for a loan or other obligation.
Collection Agency - A company hired by a creditor to collect a debt that it is owed.
Contract - An agreement between two or more parties, usually written down and enforceable by law .
Cosigner - To endorse (another's signature), as a loan agreement, lease or credit application. If the primary debtor does not pay, the cosigner is fully responsible for the loan or debt.
Credit Bureau - An organization to which business firms apply for credit information on prospective customers.
Credit Report -An account of your credit history, prepared by a credit bureau. A credit report will contain credit history, such as what you owe to whom and whether you make the payments on time, as well as personal history, such as your former addresses, employment record and any lawsuits in which you have been involved.
Creditor - A person or entity (such as a bank) to whom a debt is owed.
Debtor - A person or entity (such as a bank) who owes money.
Debt to Income Ratio - Most mortgage lenders use this ratio to analyze your financial well-being. It is figured by using your monthly debt divided by your monthly income. The lower the percentage the better your financial picture. This is often referred to as credit worthiness.
Default - To fail to pay money when it is due. A default on a mortgage or loan takes place when you fail to make the loan payments on time, fail to maintain adequate insurance or violate some other provision of your agreement with the mortgage / loan company.
Discharge (of debts) - A court's writing of off the debts of a person or business that has filed for bankruptcy.
Dischargeable Debts - Debts that can be erased by going through bankruptcy.
Down Payment - A cash payment made by a buyer when they purchase a property.
Equity - An increase in the value of your home or decrease in the loan amount on your home creates equity. Equity is the difference between what is owed on your home and the sale value. Most home equity lenders will allow you to borrow up to 80% of that value.
Fair Isaac and Company - Fair Isaac is the company responsible for creating the popular FICO score. This three digit score is created using information from your credit report and ranges from 300-850.
Foreclosure - The forced sale of property to pay off a loan on which the owner of the property has defaulted.
Garnishment - A court order directing a third party who holds money or property belonging to a defendant to withhold it and appear in court to answer inquiries.
Grace Period - A period of time during which you are not required to make payments on a debt.
Guarantor - A person who makes a legally binding promise to either pay another person's debt or perform another person's duty if that person defaults or fails to perform.
Interest - A commission you pay a bank or other creditor for lending you money or extending you credit. Usually calculated as a percentage of the mortgage or loan.
Lien - The right to take and hold or sell the property of a debtor as security or payment for a debt or duty.
Loan Consolidation - The combining of a number of loans into a single new loan. Usually done to gain more favourable terms e.g. lower cost repayments or longer time to pay.
Principal - A sum of money owed as a debt, upon which interest is calculated. If you purchased an item for $100 on your credit card that would be the principal balance.
Repossession - A creditor's taking of property that has been pledged as collateral for a loan.
Secured Debt - A debt on which a creditor has a lien. A car loan would be an example of secured debt.
Term - The time required to repay a loan.
Unsecured Debt - A debt that is not tied to any item of property. Credit card debt is an example of unsecured debt.
About the Author
1st Finance Guide features help and advice on debt consolidation amongst other general finance matters.
This article comes with reprint rights. Feel free to reprint and distribute as you like. All that we ask is that you do not make any changes, that this resource text is include, and that the link above is intact.
Bookmark this page | Search this site | E-mail to a Friend
Debt consolidation - How to avoid drowning in a sea of unpaid bills
Debt consolidation may be the answer for anyone drowning in a sea of unpaid bills. Debt consolidation lumps all of your unsecured debts including credit card bills, doctor, dentist, veterinary, and other service provider bills - any bills that are not secured by collateral or property such as an automobile or a house into one monthly payment.
Types of Debt Consolidation
There are several ways to achieve debt consolidation, including one that does not require borrowing more money. Debt consolidation options include:
1. Home Equity Loans - A popular method of debt consolidation, the home equity loan is a mortgage based on the amount of equity you have invested in your home. It should be noted that home equity loans are secured by your house, which means if you fail to make payments on schedule, and according to the terms of the loan, you risk losing your house.
2. Personal Loans - Many banks and other lenders offer unsecured personal loans based on your annual income. The amount that can be borrowed will vary from person to person, and not everyone will qualify for this type of loan. To use personal loan proceeds for debt consolidation simply deposit the loan money into your bank account and write checks to your creditors, or ask the lender to disburse the money to your creditors for you.
3. Private Loans - Some people may be able to borrow from family or friends and arrange very individual terms. Borrowing from others in your personal life can be tricky business and it is advisable to make sure any arrangements are made in writing.
4. Debt Management Plans - Not everyone will qualify for a personal loan, and not everyone owns a house, or has someone in their personal life from whom they can borrow money for debt consolidation. For people in this situation there is another option available - a debt management plan through a credit counseling agency. Even if you have all of the previously mentioned options available to you it may be more advisable to seek out a debt management plan. Debt consolidation through a debt management plan involves having a credit counselor negotiate with your creditors for payments you can afford. You end up making one monthly payment to the credit counseling agency which then sends money to your various creditors.
Regardless of which type of debt consolidation plan you choose, be sure to check out potential lenders or your credit counseling agencies thoroughly. It is also strongly advised that you destroy paid off credit cards and formally close those accounts to avoid the temptation to charge them up again. When done carefully and with consideration, debt consolidation will ease your financial worries.
Timothy Gorman is a successful Webmaster and publisher of Debt-Relief-Solutions.com. He provides more debt relief, credit counseling, repair and free debt consolidation information that you can research in your pajamas on his website.
Top rated articles for debt consolidation
1. Debt Consolidation Service - What to Watch For
When you are sure that you can get hold of your finances again and meet your creditors' payments, by taking the service of debt consolidation, you will obviously try to opt for the best enterprise. An... Read debt consolidation article
2. Student debt and loan consolidation - Best rates and plans
Student loan consolidation can have many benefits for the career minded student. With the prices of things going through the roof, going to college can be very costly. Many students don't have thousan... Read debt consolidation article
3. Debt consolidation when bills pour in
Many of us find ourselves overwhelmed with bills, bills, bills. Going to the mailbox only to find yet another late payment notice may have become a daily trauma. Your spending patterns and lack of bud... Read debt consolidation article
4. Bad Credit Home Loan To Get You Out Of Debt
A "bad credit home loan" can help you climb your way out of debt and get you started back on the road to upstanding, good credit. There are many lenders who are willing to make bad credit home loans t... Read article
5. Guaranteed Debt Consolidation Loan
When to consider a guaranteed debt consolidation loan? You should consider a guaranteed debt consolidation loan when the debtor is in danger of bankruptcy, people with many smaller high interest debts... Read debt consolidation article
6. Are debt settlement companies a scam
Are debt settlement companies scams? It's a simple question so does it have a simple answer? Along with the genuinely helpful firms, there are plenty of operations billing themselves as leg... Read debt consolidation article
7. Debt Consolidation Loan to Erase Bad Credit Debt
Restoring a number of loans of high rate of interest or else credit cards with a single consolidation loan might not just lessen your monthly reimbursements, but in addition set aside your money becau... Read debt consolidation article
8. Debt Reduction Services
Cashless shopping is clearly convenient and it there's no doubt it comes in handy whenever you don't have the cash to spare for those "unexpected" expenses or "must have" indulgences. Unfortunately, l... Read debt consolidation article
9. Best Debt Consolidation Company
Are you in a deep maze of debts? Nothing seems to be working for you? You are going to be buried under innumerable monthly payments and bills? But don't get disheartened. You are not the only one to f... Read debt consolidation article
10. Secured Personal Debt Consolidation Loans - Goodbye to Debts
You take different loans for different purposes. But very often fail to repay the loaned amount in time. Subsequently you fall under the grasp of bankruptcy and ever increasing debts. You think about ... Read debt consolidation article
Credit Counseling and Debt consolidation services in Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi,
Debt consolidation glossary - A must read
Debt consolidation services in Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania,
Debt consolidation services in Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, Washington DC, West Virginia, Wisconsin and Wyoming.
Add website or submit URL link of your site to 1000 free directory