Unsecured debt is any money you owe that is not backed by collateral.
Examples of unsecured debt are credit cards, department store cards, personal loans, and lines of credit.
Especially when taking on a new loan requires hefty fees, rolled into your total balance, or a long repayment period.
The In Charge Debt Consolidation Alternative, or debt management plan, is a program that gives you all of the benefits of debt consolidation without having to take out a new loan.
If you do qualify, you may not qualify for competitive interest rates.
Additionally, whenever you take out a new loan, there are loan origination fees which can run into the thousands.
You counselor also helps you establish a workable budget and provides other educational resources to help you manage your finances and remain debt-free.
You can consolidate your unsecured debt under these plans through the non-profit debt consolidation companies.
In many cases, the amount you pay every month will be less than if you paid to each bill separately.
Often your counselor can even reduce your interest rates and eliminate extra fees, like over limit and late charges, through the debt consolidation plan.
With credit consolidation, you take out a new loan and use it to pay off smaller loans.
Because you now only have one loan, you have one monthly payment. If your credit score is not high, you may not qualify for a consolidation loan.
With the debt management program, all of your payments are consolidated into one monthly payment that you pay to In Charge. In Charge helps you secure lower interest rates on many of the credit cards you do have (with exceptions), meaning that more of your monthly payment will go to pay off the balance, and less to interest. The In Charge debt management plan is designed to help you get out of debt in 3-5 years, paying less than you would if you continued on your own, or even with traditional debt consolidation with higher interest rates. When you work with a bank or other for-profit debt consolidation firm, you will pay fees in the form of interest and loan origination charges to secure and maintain a debt consolidation loan.