Meet Christopher – Now Debt Free Thanks to Pacific Debt

Name: Christopher

Age: 35

Location: California

 

When did you enroll in our debt settlement program and how much debt were you facing? How did carrying all of that debt make you feel?

We enrolled March 2016 in Pacific Debt’s program, with $23,176 in debt. Carrying that much debt made it almost impossible to make ends meet. We could make only minimum payments, and would immediately be checking balances and available credit to see which card we could use next. Purchases were for necessities, not fun or frivolous items. We lived credit card limit to credit card limit.

 

Christoper, Debt Free, Pacific Debt

Tell us about your journey through the Pacific Debt program? Are there any special team members you would like to recognize?

Our journey through Pacific Debt’s program was worry free and easy. We were contacted immediately whenever something was needed, and we were informed of every step taken along the way. Brian LoBianco was amazing to work with! He took care of our account and our debts in the fastest way possible, never neglecting quality service, and ended up getting us great settlement agreements with our creditors. He was professional at all times, and we could tell that he cared about us and the assistance he provided.

 

How does it feel to be debt free? What are your financial goals moving forward?

It feels amazing to be debt free! One thing this program allowed us to do is learn how to live without using credit. By not being able to use our cards, and by lightening the load that we carried, we were able to manage our budget in a credit free way, realizing what we really needed, and what we could do without. Our financial goals are to continue to live completely free of revolving debt, not having to worry about paying high interest for what easily could have been the rest of our lives doing what we were doing before.

 

We know we are not perfect. What suggestions or advice would you offer to help us improve our program? All advice is welcome.

I honestly was completely satisfied. I will say, the first 6 months to 1 year of creditor/collector phone calls was nerve racking. Understanding that things had to get worse before they could get better was key, though it was still a time that worried us. Pacific Debt made sure we understood the process, and what to do with those calls and contacts, and that made all the difference. We knew Pacific Debt was in our corner the whole time.

Your Guide to Debt Consolidation Loans

Many prospective customers call Pacific Debt in hopes of obtaining a debt consolidation loan to pay off their existing credit lines. During our initial consultation with clients, we review the fact that Pacific Debt is not a lender, and therefore does not offer consolidation loans. Instead we offer a program called debt settlement, which is a form of debt relief that does not require taking out a new loan. For more information, feel free to read and learn more about our debt settlement program.

Criteria For Obtaining a Personal Loan

For those of you who are looking for a loan, there are several factors that will determine what your options may be, here are a few of those factor:

  1. What is your credit score? Generally speaking, the higher your score, the better the rate you will be offered and the more loan options you will have. Typically the lowest rates are reserved for consumers with a FICO score of 720 and above. If you don’t know your score, financial web sites such as CreditKarma.com now allow you to track and monitor your score for free.
  2. What is your capacity for repayment? In order to obtain a loan, you are going to be asked about your employment history and level of income. Lenders prefer to see stable income and will analyze your debt-to-income ratio when considering the risk involved with extending you a loan.
  3. Are you willing to use collateral to secure the loan? If you use your home or vehicle as collateral to secure the loan, lenders may offer you a lower interest rate or overlook less than perfect credit. Of course using your home or vehicle as collateral also puts those assets at risk in the event that you default, so you need to be extremely confident in your ability to repay the loan.

Types of Loans Available

Now that you have reviewed some of the major factors that lenders will consider on your quest for a consolidation loan, here are the types of loans that might be available to you:

Pay Day Loans: Designed as a short term stop gap, pay day loans are typically obtained with the understanding that the loan will be repaid on your next pay day. These loans are typically $500-$1000 and come with huge interest – often 300% APR or higher. Be careful with these high interest loans, as they can get you in serious trouble. In fact, regulators such as the CFPB, have serious concerns about pay day loans and are taking action to curb abuses in the pay day loan industry.

Personal Loans: A better alternative to pay day loans are personal loans. Personal Loans can be either secured or unsecured and typically come with a fixed monthly payment and repayment term.

  • Unsecured: Over the past few years unsecured personal loans have become very popular. Traditionally, these loans have been offered by major credit card issuers and carry interest rates of 10-25% typically. Recently, peer-to-peer lenders such as Prosper and Lending Club have sprouted up in the marketplace, giving consumers more options than ever before with regards to consolidating their debts. The downside to most of these loans is that the interest may be just as high as what you are paying on your credit card debt. In fact, a quick review of Lending Club’s web site shows that a consumer with poor credit, looking to borrow and repay a loan over 60 months, could face an APR of 35%!
  • Secured: If you use your home or a car to secure a loan, you may be able to snag a lower interest rate on your personal loan. However, the catch is that if you default on your payments, the lender is now entitled to your property and that can put you in a very serious financial predicament. If you are considering a title loan to your vehicle, check the interest rate, as they are often just as bad as pay day loans.

Changing Financial Behavior

Once you have obtained a loan and paid off your other debts, it is important to change the behavior that led to accumulating the debt in the first place. At Pacific Debt, we frequently speak to consumers who previously obtained a consolidation loan to pay off their credit cards, but now have a large personal loan and also carry large balances on their credit cards. The bottomline is that unless your financial behavior changes, a personal debt consolidation loan is really just a method of transferring your debt from one creditor to another.

We encourage consumers to do their due diligence and research your options. If you are not comfortable with the loan being offered (remember many personal loans have interest rates over 20%) , feel free to give us a call at Pacific Debt. One of our professional and courteous counselors can review with you all of your options, and can explain how debt settlement may be an appropriate alternative. The call and consultation are free, and unlike getting a new loan, we actually work to get you out of debt for less than you owe right now – not more.

Bad Credit Debt Consolidation Loans

Bad Credit Debt Consolidation Loans

For anyone with bad credit, nothing is more frustrating than trying to find a loan. What is even worse, is trying to find one with a decent interest rate. Bad Credit Debt Consolidation Loans with low interest rates are almost impossible to get these days. Not only do you have to overcome the fact that you have bad credit, but you also have an issue of being strapped by so much debt, you are already struggling to make payments on the loans you have.

Do Bad Credit Debt Consolidation Loans Exist?

For all practical purposes, the answer is no. Consumers with bad credit and high debt are extremely unlikely to find a lender who will give money to an already struggling consumer. Lenders are not very keen on taking on risky loans and as is most often the case, the only people who can qualify for debt consolidation loans, are the ones with good credit, and don’t actually need the loan in the first place.

However, there is good news for consumers unable to find low interest rate loans to pay off their debts. Since the purpose of the debt consolidation loan was to get rid of high interest rate debt, there are other options available that can provide for the same or possibly a better outcome.

As a consumer looking for a solution that is better than paying minimum payments at 25% interest for 25 years, you should also look into both a consumer credit counseling program as well as a debt settlement program.

With a credit counseling approach, a company will consolidate your credit card payments into 1 monthly payment and typically bring your average interest rate down to around 8 to 10% depending on your creditors. Then your monthly payment will be set at a level which will usually pay off your debt in full plus the interest over about a 5 year period.

While this is certainly a good solution for some consumers, many have found the monthly payments in this type of program to simply be to high for them to realistically afford.

At Pacific Debt, we offer debt settlement programs to consumers who qualify. With our debt settlement program, we can typically negotiate a reduced principle payoff amount and settle your outstanding debts for less than you currently owe.

Some of the obvious advantages to our settlement program over a credit counseling approach is that you could be out of debt in just a few years instead of 5 and potentially settle with your creditors for less money than you owe right now.

Keep in mind that all consumers have unique situations and a debt settlement approach is not the right solution for everyone. If you find yourself in a situation where your high debt has made it impossible for you to get a bad credit debt consolidation loan, and the payments on a credit counseling program will put to much strain on your budget, contact the professionals at Pacific Debt for a debt reduction analysis. The call is free, and in fact, we don’t charge our clients a dime until we can successfully settle their debts with their creditors.

Best Debt Consolidation Loans

Best Debt Consolidatin Loans

If there was ever a great economic climate to get the best debt consolidation loans, this is definitely it. Well, sort of…

Currently we are enjoying some of the lowest interest rates of all time, which is certainly important when looking to consolidate credit card debt at a lower interest rate.

However, if you are currently shopping around for the best debt consolidation loans, you have no doubt discovered a major problem. The banks aren’t lending money for risky unsecured loans to consumers who have high debt and are struggling with their monthly payments.

Sure, if you have great credit, low debt, and plenty of cash you should have no problem getting a great loan, but for the rest of us, the borrowing window has been slammed shut. Great loans are available mainly to people who don’t really need them and not to those among us who desperately do.

The Best Debt Consolidation Loans Available Might Not Actually Be Loans At All

If you find yourself in a situation where you are struggling to keep up on your payments and cannot find any institution that will lend you money at a great interest rate, a debt settlement strategy is certainly an approach that can be explored as an alternative to a debt consolidation loan.

Ultimately, the main purpose of getting a loan is to pay off your debt, and if a low interest loan is not available, a debt settlement will likely get your debts paid off faster at a much lower overall cost than a loan would anyway.

Rather than simply lowering your interest rate, a professional debt settlement company has the ability to negotiate with your creditors to potentially reduce your principle credit card balances and create a program to have your debts resolved in just a few short years.

As with anything, there are both pros and cons to using a debt settlement approach. However, if your search for the best debt consolidation loans has resulted in nothing but rejection after rejection, you certainly should take a few minutes to explore a debt settlement option.

Whether or not it is the best solution really depends on the financial circumstances of each individual consumer. For a detailed explanation of how a debt settlement strategy works, contact the professionals at Pacific Debt for a Free Debt Reduction Estimate.

Credit Card Debt Consolidation Loans

credit card debt consolidation loans

Credit Card Debt Consolidation Loans?

Most of us are old enough to remember when it was possible to contact a credit card company, explain you just received a balance transfer offer with a low rate from another company, and they would trip over themselves to match it and keep your business.

Those were certainly the good old days when great offers for credit card debt consolidation loans came in the mail almost every week. It was almost to easy to jump from one promotional rate to the next for years on end.

These days, if you try that trick with a creditor they won’t bat an eye and most of the time the interest rate stays right where it is. In fact it even seems like your interest rate is more likely to get raised if you contact your creditor and ask them to help you out by giving you a halfway decent rate.

If you are stuck with interest rates above 20%, struggling to make minimum payments, and your credit is at a point where getting a credit card debt consolidation loan is not a possibility, you do have some options that you can look into.

One option that many consumers are turning to is debt settlement. Even though a debt settlement strategy does not involve getting a loan at a lower interest rate, it can be a very effective way to get out of debt in only a couple of years with a reduced monthly payment.

Debt settlement is not a one size fits all strategy and it does carry some risks, but if you are in a situation where credit card debt consolidation loans are just not available, and bankruptcy is not a good option, then speaking with a qualified debt settlement specialist will show you a potentially quick way out of debt that you might not have thought of.

It is a good idea to research and explore all the different options available to you to ensure that you are following the most effective debt reduction strategy for your situation. To learn about how a debt settlement plan might work for you, contact the professionals at Pacific Debt for a free debt reduction evaluation, and thorough explanation on how debt settlement works.

Unsecured Debt Consolidation Loans

concept of unsecured debt consolidation loans

The concept is simple enough. If you have high interest credit cards, you simply need to find a lender that offers unsecured debt consolidation loans and apply for one. Then you pay off all your credit cards, and have one affordable monthly payment with a low interest rate that will allow you to pay off all of your bills.

The major problem with this simple concept is that in our current economic environment, finding a lender that will extend an unsecured debt consolidation loan at a low rate is much easier said than done. In fact it is pretty much impossible for someone that doesn’t have great credit and is already struggling with their current monthly payments. No lender wants to take on another lenders problems.

Resources For Unsecured Debt Consolidation Loans

If you have been turned down for several unsecured debt consolidation loans from traditional lenders you may want to look into peer to peer lending networks like Lending Club or Prosper. Since they are programs that connect potential borrowers directly to investors and essentially cut the bank out of the equation, it can often times be easier to get an approval. However, in order to qualify for a loan your credit score will need to be at least in the mid 600’s.

If your score is lower than 670, you will not likely get approved and if it isn’t higher than the mid 700’s than the rate on your loan is likely to be in the 12% to 15% range making your monthly payments likely higher than your current minimum monthly payments. This is due to the fact that the loan will only be amortized over a 3 to 5 year period which is considerably shorter than most credit cards.

The unfortunate reality is that unsecured debt consolidation loans are simply not going to be available to the consumers who need them the most. The good news however, is that there is typically more than one path to a destination and if your initial path to debt freedom has been blocked, there are other options available that have not been.

One such option to look into is a debt settlement approach. Debt settlement does not involve getting an unsecured debt consolidation loan. By implementing a debt settlement strategy you will be attempting to negotiate down the principle balance of your debt with the creditors.

A debt settlement strategy is not appropriate for consumers in all situations. If you would like to explore how a debt settlement strategy may allow you to lower your monthly debt payments and get out of debt in only a few years, feel free to contact the Debt Settlement Professionals at Pacific Debt for a no obligation Debt Reduction Estimate.

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