Debt consolidation is a popular option for those trying to pave the path towards debt relief. It involves combining multiple debts into one new loan. Sounds great, right? Unfortunately, it’s not that quite that simple. For your own financial health, it’s important not to jump into a decision when you don’t know all the facts. One question that many consumers have is whether they can seek debt consolidation without assets. Let’s see.
Debt Consolidation Without Assets
In an ideal situation, consolidating loans would mean taking out a new loan at a lower interest rate than your current loans. That loan pays off your original loans and then you only have one monthly payment on the new, sizable loan. At its best, debt consolidation can help you save money on interest while simplifying your finances. A debt consolidation plan may also be used to restructure the terms of your debt. This means reducing your monthly payments by paying it off over a longer period of time.
But, debt consolidation is not the right choice for every consumer. For example, if you have poor credit, which is common among consumers with too much debt, you’ll have a hard time finding a lender to extend the low rates that make debt consolidation worthwhile.
The Rundown on Debt Consolidation Without Assets
So, now that we know how to consolidate debt, let’s figure out whether debt consolidation without assets is a possibility. To put it simply, yes, you can consolidate your debt without assets or collateral. Because the vast majority of consolidation loans are unsecured, it’s not necessary to place assets as collateral to secure the payment of the loan. So, if you have no significant assets, fear not!
Secured consolidation loans are not the norm. But, in the unusual event that a for-profit company does extend a secured consolidation loan, you likely will not qualify without assets to place as collateral. If you are in that situation, consider seeking alternative options to taking out a consolidation loan.
A Better Solution with American Consumer Credit Counseling
If you don’t want to take out a new loan that could cause financial harm in the event of non-payment, ACCC can help. While there are a number of debt consolidation options out there, many are fraught with risk. ACCC offers a solution to your debt problems that don’t require taking out a new loan. When you work with ACCC, you will speak to a certified credit counselor who will help you assess your financial situation, create and balance your budget, and offer personalized solutions to become debt free. If you decide to enroll in ACCC’s debt management plan, you can consolidate your debts into one – without taking out a new loan. Here’s how it works:
- ACCC negotiates with your creditors to reduce interest rates and any outstanding late fees or over-limit fees. In many cases, this can reduce your total monthly obligation and the time it takes to pay off your debts.
- You make one consolidated payment to ACCC each month, and we then pay each of your creditors.
- We provide you credit counseling and educational resources to help you gain financial literacy skills and tactics to stay debt free in the future.
For more information on debt consolidation or for help managing your finances, call ACCC at 800-769-3571 today.