A debt consolidation loan might be in order if you’re facing calls from debt collection agencies on a daily basis, and if you dread finding another overdue notice in your mailbox. When you take out one of these loans – which consolidates all your monthly debt obligations into one monthly payment – the collection calls will stop, as long as you remain current on your monthly debt consolidation payment. These loans aren’t ideal; they do come with high interest rates and origination fees. But if you’re at the point at which collection agencies are calling on a regular basis, a debt consolidation loan might be your best option.
Most states have laws regulating the way debt collection agencies can operate. Some states, for instance, may forbid collection agencies from calling before 8 a.m. or after 9 p.m. Others may limit the number of calls these agencies can make in a given period of time. Still others forbid them from using threatening or harassing language; they can’t, for instance, threaten to vandalize your property if you don’t send in the money you owe. In mid-March, the New Jersey state legislature was debating new legislation, the Debt Collection Practices Act, which would eliminate intimidating debt collection practices. The act, if approved, will also give consumers a streamlined way to dispute any debt information that they feel is inaccurate.
Avoiding the Calls
Even if debt collectors do follow state laws to the letter, their calls are still intimidating. It’s never a good feeling to pick up the phone only to be reminded once again of how much money you owe. It’s even worse when several debt collection agencies are calling you at once. These calls can negatively impact your entire life: You’ll struggle to sleep. Your relationships with friends and family members might suffer. You’ll falter at work. Living under the stress of debt is no way to be a productive citizen. It’s hard to concentrate on anything when the specter of unpaid bills is constantly hanging over your head.
The Debt Consolidation Solution
If debt is ruining your life, it might be time to investigate debt consolidation loans. These loans don’t come without penalties: They can be expensive to take out, and they will hurt your credit score. But if you follow your debt consolidation plan, you will pay off your debt and eliminate the barrage of phone calls from collection agencies. Just make sure to do your research before working with a debt consolidation firm: Make sure the firm lists (in writing) how long it will take you to pay off your debt and what interest rates and fees you’ll pay for your loan.