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People living in the US have become so used to living under the crushing weight of debt that we barely even notice how damaging it is. We want to provide better resources for our customers so that they can get a better handle of their debt. Because we want you to make the best decisions for your financial future, we’re working hard to educate you on simple financial matters that may make a huge difference in your life.
Credit Services Organization (CSO) vs. Credit Access Business (CAB)
As the economic recovery struggles to gain traction and many Americans find themselves drowning in overwhelming debts, it’s far more common for consumers to consider more creative borrowing options just to get by. We’ll do our best to provide help when needed, by turning investments in a car into liquid funds.
In an effort to provide our customers with the best borrowing options for every specific situation, we are turning our focus to educating consumers about financial matters. Laws are in place to ensure that consumers are protected, and we want to help borrowers understand the difference between a credit services organization and a credit access business.
Credit Services Organization (CSO)
CSOs were formerly defined as credit repair companies, and are any establishment that provides payment in order to extend consumer credit. CSOs are regulated by the government to ensure that all stipulations are met and that consumers don’t pay outrageous fees for help with credit repair.
Credit Access Business (CAB)
The term credit access business is used in some states to refer to the new model of CSOs. Payday loan companies and car title loan companies are required to have a CAB license that is more specific and detailed regarding the laws of these loans. A credit service organization (CSO) was the former model and was an all-encompassing establishment that did little to regulate how loans are given and paid back.
The CAB license was created by lawmakers in an attempt to define strict parameters and regulations for the borrowing industry.
Debt Consolidation as a Step toward Getting Out of Debt
We all know what it feels like to deal with the smothering weight of debts we simply can’t afford to pay. It’s not a good feeling. When you are forced to make a choice between paying your bills and feeding your family, it may be time to research borrowing options that can help you out when times get tough.
Debt consolidation is a viable option for those who want to combine all their debts and bills into one place. Combining all debts into one place won’t lessen your debt, but it can make it significantly easier to pay and keep track of where you stand financially. Consumers that regularly forget payments or have a hard time making them on time may benefit from organizing their debt in this way.
Credit cards and loans aren’t in themselves bad, but if they are allowed to get out of control and amounts pile up, they can make a prosperous financial future farther away. This is the reason why consolidation of debt can be the wisest choice when there are too many different types of payments to keep track of or if the interest rates have been driven too high. Instead of juggling multiple debts, you’d have just one payment to make.
It is important to remember though, that consolidation may solve one symptom of having debt, but it won’t fix any underlying causes that led to it. For a brighter financial future, it is important to also practice responsible spending, saving and budgeting habits for a more permanent solution. Commit to making and even writing down a money strategy and stick to it. Consider getting an extra job to bring in more money, cutting out unnecessary spending and living on less than you make to start paying off your debt for real.
How Debt Consolidation Works: The Four Types
Standard Debt Consolidation
When a peer-to-peer lender, credit union or bank consolidates your debts into a new loan, it typically has a lower interest rate than what you were collectively paying before. However, you need to be sure that you are obtaining lower rates than before because if you have a low credit score, the interest rates could be higher than what would be worth it.
Balance transfers are when you move all of your credit card debt onto one new or existing card. Often, this is done because of promotions like low introductory rates or offer periods with no required payment. Although, usually, the low interest rates are typically just for a promotional period which means that they will expire and return to normal interest rates. Be aware of when that expiration will take place and what the regular rate will be. Sometimes putting too much debt all on one credit card can also damage your credit score. Be aware of your credit limit. It is important to avoid getting too close to or going over a credit limit. Also, avoid applying for too many credit cards at one time as this can hurt your credit score too.
If you already have a mortgage and have some equity in your home, you may choose to borrow money using your home as collateral to pay off credit cards or other small debts. In order to do this, you must have a decent amount of equity already built up in your home. Equity is the value of the property after subtracting the charges against it. These loans usually have significantly lower interest rates, but don’t forget that your house would be on the line. You could face foreclosure if things go wrong, so be sure that you can make the payments each month.
Student Loan Consolidation
This is similar to a standard debt consolidation, except borrowing is typically done from the federal government, which offers flexible payment schedules and low interest rates. Consolidating your student loan debt can give you a significantly longer time period to repay the debt which can be what you need. But be aware that sometimes you can lose some of the borrower benefits that came with the original loan when consolidating that debt.
If you hope to simplify your life and budget, debt consolidation may be a viable option for you. If you do decide that debt consolidation is the next step towards your financial freedom, then you can consider all the various ways above to go about it and pick the smartest option for you.
- Don’t spend the money that your refinancing frees up every month. Save it or use it to repay your debt.
- Negotiate! Don’t be afraid to ask your bank, credit union or credit card provider to give you a better deal if they want to keep your business.
- Shop around everywhere before signing.
What are Car Title Loans?
We might be able to offer you an online car title loan to get you out of a tight spot. We offer online car title loans to consumers that own a car, truck, van or SUV who need money in a short amount of time.
Car title loans allow you to use the equity in your automobile to borrow money at competitive interest rates while keeping and driving your car. Our payments are paid back over a period with no unexpected fees or balloon payments. There are absolutely no penalties for paying us back early. Title loans can be extremely beneficial when you need emergency funding because you can borrow a substantial loan as quickly as the next business day.
Are Car Title Loans a Form of Debt Consolidation?
While traditional debt consolidation may be a long-term solution to your debt problems, we offer shorter term help in the form of title loans for budgets are stretched for many reasons.
This could be because of:
- Medicals bill
- Credit card bills
- Legal debt
- Owing money to friends or family members
Whatever your situation, we offer loans that are accessible even to people with bad credit. If you have credit card debt or other payments you need to make fast, an auto title loan could help you catch up on overdue payments and debt, but it isn’t recommended necessarily as a form of debt consolidation.
When dealing with debt, it is important to act quickly. First, begin our online submission form or call us to start the process. Our team will then evaluate your vehicle and your financial situation to see if you qualify for a loan, for how much and at what interest rate. This is a free quote and you would be under no obligation to accept the loan. But, if you do, you could have money as soon as the next business day to go toward some of your outstanding bills or debts. Then, you’ll be able to keep driving your car while making your monthly payments in one convenient place.
We would love to talk to you if you are interested in discussing title loans more. Call us today at 855-422-7412 or start a chat online to speak to a friendly representative about the benefits of car title loans.