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My Money - What is Debt Consolidation

Here is some information that will help you understand.

Posted: Jun 14, 2018 6:29 PM
Updated: Jun 20, 2018 2:03 PM

Link: https://www.firstalliancecu.com/blog/is-it-time-to-consider-debt-consolidation

Q: We hear about debt consolidation a lot. What is debt consolidation?
A: Debt Consolidation loans are used to pay off other outstanding debts, so instead of continuing to pay multiple payments each month, you only have one.

Q: What is the most common type of debt consolidation loan?
A: The most common type of debt consolidation loan is an unsecured personal loan, but debt consolidation can also be accomplished through a home equity loan, or even transferring credit card balances from high rate cards to a lower rate credit card. Once you have consolidated your debts, even though the total amount you owe is still the same, your monthly payments are usually lower because the loan is now a fixed payment and your interest rates are lower.

Q: Once you consolidate your debts, what happens to the old debts?
A: It really depends on what kind of debts they are, but overall your outstanding debts are paid off in full, so they will reflect on your credit report as such. For example, with a credit card if you close the card, it will reflect on your credit report that the debt has been paid and the card is closed. If you are going to keep the card open, then it will report with a $0 balance unless you begin to charge your card again. As for installment loans, like a car loans, it will report on your credit report that it has been paid and is closed. These changes will affect your credit score differently based on your overall credit report.

Q: Is there ever a time when debt consolidation is a bad idea?
A: Debt consolidation is best for someone who is paying high interest rates on multiple debts or is struggling to pay all their debts on time every month. There are definitely situations where debt consolidation isn’t needed. For example, we have seen where the interest rates that people currently have are better then what we can offer through debt consolidation, when we see this we help you structure your finances to pay off the debt quickly, usually through setting up a budget and a payoff plan. Overall, when you consolidate your debt you should end up with a lower monthly payment and with lower interest rates. If this is not possible then debt consolidation might not be the best option for your financial situation.

Minnesota Coronavirus Cases

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Cases: 609810

Reported Deaths: 7746
CountyCasesDeaths
Hennepin1263481799
Ramsey53049910
Dakota47251475
Anoka43239465
Washington27676296
Stearns22670227
St. Louis18260319
Scott17701139
Wright16528153
Olmsted13517103
Sherburne1213096
Carver1074649
Clay829692
Rice8252111
Blue Earth770744
Crow Wing688599
Kandiyohi670085
Chisago627054
Otter Tail590687
Benton585398
Goodhue485674
Douglas478481
Mower477633
Winona463752
Itasca462768
Isanti446066
McLeod434361
Morrison427962
Beltrami410263
Nobles410050
Steele400819
Polk390872
Becker389357
Lyon365254
Carlton356958
Freeborn351134
Pine337623
Nicollet334245
Mille Lacs314956
Brown308840
Le Sueur299727
Cass288233
Todd288233
Meeker266044
Waseca240823
Martin237033
Roseau212421
Wabasha20843
Hubbard198041
Dodge18973
Renville183446
Redwood178141
Houston175516
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Wadena165023
Fillmore159210
Faribault156920
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Pennington153820
Kanabec147828
Sibley147310
Aitkin139237
Watonwan13619
Rock129019
Jackson123112
Pipestone117126
Yellow Medicine115320
Pope11396
Swift107518
Murray107410
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Stevens92611
Clearwater89217
Marshall88817
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Wilkin83813
Lac qui Parle76122
Big Stone6094
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Lincoln5863
Mahnomen5669
Norman5509
Kittson49122
Unassigned48293
Red Lake4037
Traverse3825
Lake of the Woods3484
Cook1740

Iowa Coronavirus Cases

Data is updated nightly.

Cases: 374664

Reported Deaths: 6109
CountyCasesDeaths
Polk58891646
Linn21448342
Scott20426250
Black Hawk16680319
Woodbury15319230
Johnson1473686
Dubuque13595213
Dallas1144099
Pottawattamie11307177
Story1082848
Warren592092
Clinton564393
Cerro Gordo562297
Webster538996
Sioux519174
Muscatine4920106
Marshall491479
Des Moines478275
Jasper452073
Wapello4366123
Buena Vista431040
Plymouth404982
Lee392658
Marion369177
Jones301257
Henry301037
Bremer292763
Carroll286252
Boone271234
Crawford270841
Benton262755
Washington259851
Dickinson250745
Mahaska232551
Jackson225842
Kossuth219166
Clay217327
Tama213372
Delaware211743
Winneshiek200636
Buchanan196734
Page195422
Cedar192923
Hardin191144
Wright189140
Fayette188243
Hamilton186851
Harrison181973
Clayton173057
Butler167835
Madison167719
Floyd164642
Mills163824
Cherokee161538
Lyon160941
Poweshiek159036
Allamakee155552
Hancock153134
Iowa148324
Winnebago145731
Calhoun143113
Cass140855
Grundy139333
Emmet136741
Jefferson134535
Sac132620
Shelby131838
Louisa130249
Union129535
Appanoose128049
Franklin127823
Mitchell127243
Chickasaw125717
Guthrie124532
Humboldt124526
Palo Alto114924
Montgomery106738
Howard105322
Clarke102424
Monroe100633
Keokuk99932
Ida92735
Adair89632
Davis86825
Pocahontas86822
Monona85931
Greene79111
Osceola79017
Lucas77423
Worth7568
Taylor67112
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Van Buren56718
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