People these days are saving less and incurring more debt, including credit cards, medical bills and student loans. Debt consolidation can use settlement talks with your creditors as a strategy. Our partners at ConsumerAffairs looked at the best companies for debt consolidation in Cleveland for those looking to reduce credit card debt.
Consumers can get into debt in many ways, including mortgage loans, auto loans, student loans, credit cards and medical bills. Lower interest debt, such as mortgages and auto loans, is secured with property. Credit card debt is seen as one of the most toxic debts because it is unsecured and has high interest rates.
Credit card debt in Cleveland
Average number of cards
Average amount of credit card debt
Debt quickly builds, especially relative to income. The median income in Cleveland is $27,551, significantly less than Cuyahoga County ($46,601), Ohio ($52,334) and the nation ($57,617). About 35 percent of the population in Cleveland lives below the poverty line compared to 12.7 percent nationally and 14.6 percent in Ohio.
Debt consolidation is a way to better manage and reduce debt (and your stress level). Multiple unsecured debts are combined into a debt consolidation loan. Debt consolidation companies facilitate this process for consumers and charge fees. Debt consolidation simplifies things by allowing you to have one single payment and one due date. The consolidation loan generally has a better interest rate, allowing for more manageable monthly payment and more of your payment going toward the principal amount.
The process may be a long-term commitment based on your situation. Your credit rating will drop initially; however, it will improve over time if spending habits improve and credit use is limited. Be sure you understand the fees you pay to the debt consolidation company.
Avoiding bankruptcy in Cleveland
Debt consolidation is a more favorable option than bankruptcy in the long run. Bankruptcy is a last resort when consolidation is not realistic because of too much debt and not enough income. Bankruptcy stays on your credit report for 10 years, leaving a very negative mark. Bankruptcy is a legal process overseen by the federal government that should be used only in dire circumstances.
A well-established national company, National Debt Relief specializes in alternatives to bankruptcy. They have an A rating with the Better Business Bureau. One customer explained that they open up a dedicated bank account specifically to be used for paying and tracking the debt consolidation.
For debt relief solutions, CreditAssociates works to settle debt in 24 to 36 months. Good credit is not required and customers get a free, no obligation consultation by speaking to trained advisors who are experts in negotiating down debt. Customer reviews speak highly of agents for being professional, helpful and communicative.
The goal of Freedom Debt Relief is to resolve your debt for much less than you owe, as quickly as possible. The process starts with a personal phone call with a certified debt consultant who reviews your options, then can set up a customized plan with payments you are comfortable with. Clients can then view their progress 24/7 through the online dashboard.
Debt Rx is an experienced debt settlement company. They work with people having $7,500 or more in credit card debt. The company prides itself on being smaller than its competitors to better focus on personal service to find individual solutions for debt relief. For those behind on payments, Debt Rx may be the right prescription to ease the pain of being in debt.
A local bank headquartered right here in Cleveland, Third Federal offers debt consolidation. They emphasize using a home equity loan for the purposes of the consolidation. Customer reviews report that they are known for having low interest rates for borrowers.
OneMain Financial describes itself as the largest source of personal loans in the U.S. They have been in business for more than 100 years and have a local branch in the Cleveland suburb of Middleburg Heights. Overall reviews are positive; however, some suggest that borrowers must have very good credit.