Debt Consolidation

At a time when debts got the better of individuals in America, debt consolidation took a greater leap. It got the better of debts. Debt in the U.S. is a national curse, somewhat akin to a Tornado, destroying the lives of thousands of people. Inability to repay debt amounts has caused real trauma in the lives of hundreds but at the same time thousands of individuals were also saved with debt consolidation programs.

According to the Federal Reserve Statistical release debt toll had taken an alarming rise for the past couple of years.
The year 1999 showed 1530.4 billion $ in debt. The Revolving credit in this year was 607.6 billion $ and the Non revolving credit amount was 922.8 billion $.
In the year 2000 the debt toll had advanced to 1705.1 billion $ with the revolving credit as 677.7 billion $ and non revolving credit as 1027.4 billion $.
2001 was no exception with 1842.2 billion $ with 722.2 billion $ in revolving credit and 1119.9 as non revolving credit.
In 2002 the conditions went worse with 1924.2 billion $ with 738.3 billion $ in revolving credit and 1185.9 billion $ in non revolving credit.
In 2003 it was alarmingly high with 2011.3 billion $ with 758.7 billion $ as revolving credit and 1252.6 billion $ in non revolving credit.

Debt consolidation has come as a blessing to hundreds of debt struck people across the world. Debt consolidation package includes credit counseling, debt management and budgeting plans. These programs are highly beneficial and save a debtor from a huge amount of hassles from multiple creditors. Clients who successfully completed a Debt Management Program (DMP) felt that it provided a wealth of different benefits for the present times and also for the future. Almost 85% of clients felt that the ability to payoff their debt was better and almost 55 % felt that the plan helped stop collection calls. In the long run, the feedback was that almost 32% of the debtor's felt that the plan helped them balance their budget and almost 41% felt that they learned new budgeting skills. A total of almost 38% felt that they improved their credit worthiness and almost 51% felt that they improved their overall financial status.

Let us analyze a case whether debt consolidation could be of help or not:

Mr. John, a resident of Washington has a credit card debt of $20000. The current APR which is being charged on his debt amount is 15%. Mr. John has planned to payoff his debt by paying $300 per month to the creditor. At the end of 1st month, Mr. John will pay $250 ( $20000*15%/12 months ) towards interest and rest of the part of his monthly installment i.e. $50 ( $300-$250 ) will be adjusted towards reduction of his principal loan amount. In this method it will require 144 months or 12years to pay off his existing debt. Now, if he enrolls in a debt consolidation program his debt amount will be reduced to 40 – 60%, and his APR will reduce from 15% to 6%, or even less. So with debt consolidation Mr. John will be able to repay his debt within 82 months (6 years 6 months) instead of 144 months.

Debt consolidation firms appoint for you a debt consultant of your locality once you get enrolled in the program. Expert help in debt related issues along with strategic handling of the creditors on your behalf ultimately pulls you out from the debt trench. As the famous American author O.W.Holmes has written "Put not your trust in money, but put your money in trust'. It is very important for a debt struck person to choose the right firm and the right program to get debt free. With the increase of popularity in debt consolidation, the firms have also grown at a random in all corners of U.S. Careful analysis is required to select a reputed firm, and not get trapped by firms having hidden fees or irrational company policies.

The current trend in debt shows that each year total consumer debt (both revolving and non-revolving) has an increasing rate. In 2000 and 2001, total consumer debt has a rising trend by 11.42% and 8.04% with respect to just previous year. However, with the popularity of debt consolidation programs in 2002 and 2003, total consumer debt increased by 4.45% and 4.52% respectively. This was a decreasing rate of growth when compared to the debts the year before. As there is no specific trend in total consumer debt we may conclude that in 2005 the total consumer debt will have an increasing trend of 4.49%, which indicates that at the end of 2005 total consumer debt, will reach about $2109.85 Billion.

We present you with a list of authentic creditors who can be of immense help during times of debt. But above all we recommend you to do it yourself. You can be a great resource to clear your own debts and lead a happy and prosperous life.

Debt consolidation is your true friend at times of debt calamities, when compared to the legal hassles and rigid conditions attached to bankruptcy.

For more in-depth analysis of debt consolidation procedures please view:

http://www.debtconsolidationcare.com
http://www.debtconsolidationcare.com/benefits.html
http://www.debtconsolidationcare.com/credit-counseling.html
http://www.debtconsolidationcare.com/debt-management.html