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Debt consolidation.

Q A I want to consolidate my debt. Could you give me names of some of the companies that are top ranked?

--L. Chaira

Los Angeles

I'm sure you've been dreaming about the day when you'll get only one statement each month instead of a stack of bills in your mailbox. However, you should proceed with caution.

If you have a very high debt load and a low credit score, you might not qualify for the best interest rates on a consolidation loan. Another drawback of debt consolidation is that it makes it appear as if you have less debt. Consequently, you might be tempted to spend more money, thus entering a cycle of overspending.

Consolidation can be risky, especially if you take out a home equity loan or line of credit to pay off your debts. Failure to keep up with payments could mean the loss of your home. I would recommend that you focus on managing your current debt rather than consolidating. With that said, Justin Pritchard, author of The Everything Improve Your Credit Book (Adams Media; $14.95), suggests, "When looking for a consolidation loan, tap into your existing bank and credit union relationships. Another option is peer-to-peer lending or a 0% credit card balance transfer offer." For more on consolidation, read "Risky Solutions to Debt Elimination" on

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Title Annotation:ASK YOUR ADVOCATE
Author:McRae, Sheiresa
Publication:Black Enterprise
Article Type:Brief article
Geographic Code:1USA
Date:Nov 1, 2008
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