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Debthunch Review: Debt Consolidation Will Hurt Your Credit

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Debthunch

Debthunch isn’t a lender. They appear to be a lead generator selling consumer leads to the highest bidder. They are primarily selling to debt settlement companies but they are sending out direct mail offering 0% interest rates. It seems a bit misleading to me,

You probably received a mailer with a personalized debt consolidation analysis offering a savings of $667 per month with a 0% interest rate and promising to save you $71,550.

Seems a little good to be true?

And off you go looking for Debthunch reviews

Debt consolidation is becoming increasingly popular among those who have debt coming from multiple sources and want to achieve more streamlined finances. It’s a debt repayment tactic that bundles together all your debts such as credit card debt, outstanding medical bills, student loans, and car loans at one place for some fees. Based on your credit situation, your lender will come up with a single payable interest rate that applies to the consolidated debt.

With all your debt under one roof, you may find it remarkably easier to pay off your debt via the debt consolidation route. But a major concern for all those considering debt consolidations is that whether this method hurts your credit score or not. Why should your credit health suffer if you’re determined to pay off your debt?

The fact is: debt consolidation has the potential to be strongly favorable for your credit, but if not handled well, it can prove just as disastrous. In this guide, we’ll comprehensively address your question of ‘will debt consolidation hurt my credit?’ By the end of the article, you should be in a much better position to decide whether debt consolidation is right for you.

How Debt Consolidation Impacts Your Credit Score?

The two most common debt consolidation approaches include debt consolidation loans and balance transfer cards.

The former is a personal loan people obtain and use to pay off multiple debts. Since the loan has fixed terms and interest rates, things get a lot more predictable for you. You know exactly how much is to be paid each month and know exactly when all your debt will be repaid.

On the other hand, the second popular approach is to transfer all your debt to a low-rate balance transfer card. You’ll save on interest during the short introductory period, but the rate will surge after that and will remain subject to change thereafter, making things less predictable.

Ways Debt Consolidation Hurts Your Credit

Triggers Hard Inquiries: Whenever you apply for credit, including debt consolidation, the lender makes a hard inquiry into your credit. This means they’ll evaluate your creditworthiness by pulling your credit from a credit bureau. The problem is that each hard inquiry adversely affects your credit score, causing it to dip for a few months.

Hence, before you move forward with a lender, make sure you’re up for a hard inquiry and the associated impact on your credit, or choose a lender who allows you to prequalify online with a soft pull or soft credit check that has no effect on your credit.

Decrease in the Average Age of Your Accounts: Considering you have a proven track record of making payments on time, having a long credit history helps keep your credit score high. It contributes to around 15& of your FICO score. However, obtaining a new debt consolidation loan reduces the average of all credit accounts, resulting in a dip in your credit.

On top of that, you could be tempted to close your old accounts after getting a debt consolidation loan or balance transfer. This not only reduces the average age of accounts even further but may also increase your credit utilization, both of which will certainly damage your credit. Therefore, it’s always best to keep your credit accounts open, as long as there’s no risk of racking up more debt on them.

Increase in Your Credit Utilization: Your credit utilization ratio, which is the proportion of your available credit that you’re using at a certain point, makes up around 30% of your FICO score. Upon consolidating your debt, if the ratio increases, your credit score will take the hit. For example, if your existing credit card has a balance of $5,000 and a limit of $20,000, your credit utilization ratio would be 25%. If you seek a balance transfer and you’re your $5,000 moved to a new credit card that has a limit of only $10,000, your credit utilization ratio on the new card will be 50%, potentially hurting your credit score.

Ways Debt Consolidation Helps Your Credit

Diverse Credit Mix: The different types of credit accounts add up to make your credit mix. The most common types include installment debt and revolving debt. The more diverse your credit mix is, the better it is for your credit score. Obtaining a debt consolidation loan means you’re adding to your credit profile an installment loan. This may boost your credit score as a result.

Decrease in Credit Utilization: If the percentage of your available credit that you’re using decreases as you consolidate your debts, your credit score may improve. This is exactly the opposite of how an increase in the credit utilization ratio would hurt your credit. But again, if you let your credit card balances run up again, it can exacerbate your debt and credit situation instead.

Payment History: Payment history is the most influential factor, making around 35% of your FICO credit score. If you already have an impressive track record of making payments on time, debt consolidation won’t make much difference to your credit health. However, if the streamlined payments on your debt consolidation make it easier for you to pay on time, every month, debt consolidation can significantly improve your credit score.

Conclusion

By now, you should have developed a fair idea about how debt consolidation impacts your credit. There are several factors that together make up your credit score. When consolidating your debt influences those factors, your credit will inevitably take the impact.

Having said that, it’s important to understand that debt consolidation alone doesn’t solely hurt or improve your score. The way you behave after consolidating your debt matters big time. This means you need to stay on top of your monthly payments and avoid accumulating more debt again.

We hope that your query of ‘Will debt consolidation hurt my credit’ has been answered. When you know the ins and outs of how debt consolidation impacts your credit, your decision should be easier. To get started, check whether you qualify for a debt consolidation loan or not.

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Orioles Funding Reviews How To Safeguard Your Personal Finances In A Recession

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Orioles Funding Review

Who is Orioles Funding?

Ad Disclosure: We receive referral fees from partners. Click For More Info

Orioles Funding knows that paying off your unsecured debt is one of the best investments you can make. An Orioles Funding consolidation loan allows you to pay less interest, get out of debt faster, and start focusing on other goals… Like building a savings account, college fund, or a big family vacation. We are real people who want to make your life better. Live a debt-free life with a review of Orioles Funding.

Orioles Funding debt consolidation

Recessions are not common occurrences, so it’s natural if your first instinct is to panic when the threat of recession looms.

Any period of notable economic decline that endures for at least two consecutive financial quarters qualifies as a recession.

A declining economy impacts various areas from income and employment to retail sales and manufacturing. Recessions also negatively impact the GDP (gross domestic product) growth rate. This reflects the market value of goods and services.

Now, while you shouldn’t panic about a recession on the horizon, you certainly shouldn’t ignore it either.

Orioles Funding Shares Some Simple Ways You Can Prepare Yourself To Better Weather The Pandemic-Induced Storm.

1) Build an Emergency Fund

Job losses are commonplace during periods of recession. Some industries will be more acutely affected than others.

Whether you feel like your job is in jeopardy or not, it’s a smart move to start building an emergency fund.

To achieve this, you can start by minimizing expenditure. Scale down luxuries like eating out, traveling, and entertaining.

You should aim to accumulate 6 to 12 months of living expenses. In the event of job loss or needing to pay more for medical bills or other benefits, an emergency fund to draw on will give you the breathing space you need until the economy bounces back.

2) Get Yourself a Side Hustle

When the economy slows down, it’s a great time to secure a side hustle. Money earned from side gigs can be used to swell your emergency fund.

If you lose your job in a recession, having a side hustle to fall back on will also provide you with at least some income until you get back on your feet.

Consider freelancing. Many microsites allow you to sell a variety of services to a market of willing buyers. Think about consulting work if you have marketable skills. Research any ways you can create extra income streams in line with your skillset.

If you have a spare room, you could think about renting this out to bring in some extra cash.

3) Upgrade Your Resume and Stay Marketable

Recessions affect employment so it pays to keep your resume current.

Include any new classes, workshops, or skills you might not have added since you last looked for work.

It’s a good time to investigate any relevant areas of personal development, too. Picking up new skills will ensure you’re most likely to be retained if your employer needs to start shedding personnel.

Sharpening your skills will boost your chances of staying employed, and will also increase the likelihood of finding a new job if you need to.

4) Network Aggressively

Whenever you feel your livelihood could be endangered, it pays to start preemptively networking with groups and companies looking for people with your background and experience.

LinkedIn is a great platform for connecting with hiring managers in your industry. You could also attend alumni networking events, and join relevant local business groups.

Always have a well-honed elevator pitch ready so you can sell yourself in 60 seconds flat. What do you do best and why should someone hire you?

5) Pay Down Debt

The less you owe, the easier you’ll find it to ride out the recession. You’ll have more money in your pocket each month and you won’t be squandering money on interest payments either.

To reduce your obligations, you’ll need to stop increasing your credit card debt, and you’ll need to stop applying for more loans. If you can write a check and pay down your debt, do so. Do not pay off the debt in full unless you already have a sufficient emergency fund in place.

If you’re unable to pay off the debt in full, increase minimum payments and formulate a plan to pay that debt down.

Examine your spending and identify areas you could cut back. Apply these savings to the debt.

If you find a side hustle, use this money to pay down debt.

Bottom line, eliminating debt saves money, and it can boost your credit score, too. Then, if you need to borrow in the future, you should qualify for keener interest rates.

6) Look at a Dollar-Cost Average Strategy for Investments

A dollar-cost averaging strategy to investing can minimize your risk.

The goal of this strategy is simple: to reduce the effects of volatility by investing a fixed sum in a specific stock or fund at set intervals.

By putting your investments on autopilot, you remove emotion from the process. Also, you’ll avoid investing all your money each month at a point where prices are sky-high. You’ll be free to buy when more shares if prices are low and fewer shares if prices climb.

7) Review Your Portfolio

If a recession seems likely, it’s wise to scrutinize your investment portfolio.

Could you make any tweaks to better offset volatile periods like recession?

Is your portfolio sufficiently diversified?

Here are some ways to make sure your investments are protected:

  • Speak with your financial advisor
  • Consider investments with a history of weathering market decline
  • Ask for recommendations about balancing your portfolio

While it’s natural to panic at first, it’s key to maintain a long-term perspective when investing, even if you’re experiencing an economic downturn.

Markets tend to recover and stocks typically appreciate more rapidly than bonds and other investments.

Final Thoughts

Luckily, you can often pick up on warnings of a recession before it unfolds. This means that in the majority of cases, you do have time to prepare yourself.

The most effective strategy involves heeding warnings of a recession and taking the necessary preparatory steps. The very worst thing you can do is to panic and make reckless, impulsive financial moves.

If you require advice on rebalancing your portfolio, you should speak with a financial adviser.

Remember: the threat of a recession is no time to take the ostrich approach. The more steps you can take before a recession kicks in, the easier you’ll find it to survive, and maybe even thrive when times get tough.

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Sabres Capital Issues Biden Personal Finance White Paper

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Biden Sabres Capital

Who is Sabres Capital?

Sabres Capital wants you to invest in your future. The best way to do that: live debt-free. A debt consolidation loan with Sabres Capital is one of the best investments in your future you can make: get out of debt faster, likely pay less interest than you are currently paying, and start saving more immediately.

And remember, you are not alone: Sabres Capital Reviews your debt and finds the best way to pay it off.

Sabres Capital Explains How Biden’s Campaign Promises Will Affect Your Personal Finances

Taxes

Throughout the presidential campaign, Biden has stated his intention of altering existing tax rates.

Proposed changes would mainly impact the wealthiest Americans and large corporations. Biden recommends raising the rate for affluent Americans to 39.6%, up from 37%.

Anyone earning over $400,000 annually will likely lose out on the tax cuts they enjoyed under President Trump, and they’re likely to pay more tax each year. Also, anyone with over $1 million in overall income will probably see taxes hitting their capital gains and dividends, too.

For corporations, Biden proposes to raise corporate tax rates to 28%, up from 21%.

Middle-class Americans earning less than $400,000 a year might see some tax relief, though. Biden claims he will offer refundable tax credits for housing, healthcare, and childcare along with COVID-19 relief.

Sabres Capital Review Gets Thumbs Up For Debt Consolidation

COVID-19

Biden plans to implement major changes to the manner in which the government handles the COVID-19 pandemic. Biden wants more control at the federal level rather than allowing state governments to formulate COVID-19 policies.

The president-elect has started creating a COVID-19 task force. He also plans to release another large stimulus package under the HEROES Act. This proposal would offer each family member another $1,200 in stimulus money, capped at $6,000 per family.

With his “Build Back Better” plan, Biden wants to give entrepreneurs and Main Street businesses both some welcome relief. One goal is to create millions of paid jobs from manufacturing positions through to public health roles.

Tribal, local, and state governments will all receive federal aid to prevent key workers like firefighters or educators from being laid off.

Healthcare

Biden’s intentions for America are not clear.

It’s believed he will rework the ACA (Affordable Care Act), but the Supreme Court hasn’t yet weighed in.

Biden recently labeled this new plan Bidencare, a reworked version of the previous iteration of ACA informally known as Obamacare.

This plan would give Americans a new option for health insurance along the lines of Medicare. This would be rolled out in all 50 states. Citizens offered healthcare by their employer could enroll instead in the Marketplace plan.

Biden also plans to give tax credits to anyone unable to afford their insurance premiums. This would reduce the cost of health insurance to a maximum of 8.5% of a family’s income.

By reducing the cost of prescription drugs, Biden will make these more accessible.

Firstly, legislation will need approval from both the House and the Senate. It’s unlikely that a Republican-run Senate would approve all these changes.

Plans would deeper the federal spending deficit by a further $1.5 trillion. This deficit is already at $3.1 trillion for the fiscal year 2020.

Education

Biden wants to slash the costs of higher education, potentially giving many more Americans the means to attend college.

Tuition

Joe Biden intends to make two-year community colleges and other training programs along these lines free.

Also, students with family incomes below $125,000 would pay no tuition if attending a four-year public university.

Biden also hopes to increase the number of affordable entry points to higher education. His education plan would provide more federal funds to Pell Grants. This allows students to pay for tuition with funds from grants. Beyond this, Biden will incentivize state governments to give students extra financial aid when required for essentials and college supplies.

Loan Forgiveness

Biden’s proposed loan forgiveness program will eliminate $10,000 from the federal loans of all students because of the COVID-19 pandemic.

Another proposal for Biden also involves student loans. The idea is that students would pay just 5% of annual income over $25,000 toward debt. If these 5% payments are made for 20 years, the remaining balances default to $0. Anyone making below $25,000 a year would make no payments at all.

$10,000 of student debt each year would be forgiven for anyone working in national or community service.

The goal of these plans is to dismantle existing barriers to higher education while also reducing the financial burden of anyone struggling to pay off student debt.

Investments

Biden’s presidency is also likely to impact the investment sphere, particularly with regard to stock prices.

Uncertainty during the election caused stock prices to increase nationwide.

With a Biden administration, there could be a spike in renewable stocks, with Biden pushing for more green energy initiatives.

With Biden starting to make adjustments to relief funds for COVID-19 liable to impact the stock market, investors should proceed with extreme caution.

Biden also intends to improve the affordability of housing. This will be achieved through rolling out refundable tax credits for use toward rent and mortgages.

$15,000 of these credits will be available to help with down payments on houses. Biden also intends to boost federal rental aid with the allocation of $10 billion to be used for rental housing for all low-income workers.

The overarching goal is to bring housing costs down to reflect no more than 30% of total income.

Childcare

The aim of childcare is to introduce refundable credits for childcare costs.

Child Tax Credit would be increased for children under 6 to $3600. For children aged 6 through 17, this will be $3000. The credit can be used for childcare, clothing, or food. Payments would be monthly or yearly.

Retirement

Not all of Biden’s mooted changes to retirement will come to fruition with the Senate controlled by Republicans unlikely to agree to any of these proposals. His original plans to increase benefits for the poorest Americans from Social Security, and a lowering of the minimum age for Medicare, down to 60 from 65, would not be sanctioned and are likely to remain unchanged.

A bi-partisan government could agree to enact a plan (Secure Act 2) requiring companies to register employees in 401(k)s.

Biden will need to compromise on retirement ideas if the Senate stays Republican-dominated.

Final Thoughts

The Biden presidency will trigger serious changes to the economy, just like all new presidencies.

If Biden’s plans come to fruition, aid and relief should help students, parents, the middle class, and the unemployed.

Dennis Prager

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