Debt Consolidation!

[Nelli]

I am thinking of consolidating my debts. But I am confused by the amount of companies offering "so-called" help, in the form of a loan, negotiation. I've heard terrible things regarding certain companies with TV Advertisements. What's the best step to take if you have a poor credit rating?

[andy hughes]

Financial negotiations are a minefield for the inexperienced - you are right to be cautious. The schemes offered by some companies advertising on TV often involve signing your property over to them as security against a loan they will give you. It looks attractive on the surface - the notion of reducing your payments by 80% or what ever the info says, but it can be a real nightmare if you don't know exactly what you are doing. Best advice is to contact your local bank and have a chat with them - most high street banks have experienced staff who can give you proper advice, or a sensible first step is your local Citizens' Advice Bureau, who again have experienced debt counsellors and their advice is impartial and free. Try both those options before you approach any of the advertised companies. Go prepared - take a list of all your debts including amounts owed, payments, and lengths of payments, as well as a list of all your incomings and outings. Take paper and a pen with you, and make notes on what they say. If you are unsure about going alone, take a friend with you, it's perfectly acceptable, but be honest, and make sure you understand everything that's said to you - if you're not sure, ask questions, and get the name of the person who deals with you, to confer in future if necessary. Good luck!