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How do you qualify for credit card debt consolidation?
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Credit card debt has become an increasingly pressing issue for millions of Americans over the last few years. The average cardholder now carries nearly $8,000 in credit card debt and the total amount nationwide is currently $1.14 trillion — a record high. This surge in credit card usage, coupled with the current average card interest rate of nearly 23%, has resulted in big issues recently, like an uptick in maxed-out credit card users and a rise in delinquent credit card accounts.
There are a few drivers behind the recent surge in credit card usage. One is that economic uncertainty and the rising cost of living have contributed to more people relying on credit cards to make ends meet. The ease of obtaining credit cards and the allure of rewards programs have also led many to accumulate multiple cards, often without fully understanding the long-term financial implications of carrying balances.
For those who have found themselves in over their heads, debt consolidation offers a potential lifeline. This financial strategy involves combining multiple credit card balances into a single, more manageable debt. By doing so, borrowers can potentially lower their interest rates and reduce their monthly payments. However, not everyone automatically qualifies for debt consolidation, and it’s crucial to understand the options available and their respective requirements.
Don’t let your debt issues compound. Take steps to get rid of your high-rate credit card debt today.
How do you qualify for credit card debt consolidation?
There are two primary types of debt consolidation: traditional debt consolidation and debt consolidation programs. Traditional debt consolidation typically involves borrowing money from a bank or credit union, typically in the form of a personal loan, a home equity loan or a debt consolidation loan. With this approach, you use the borrowed funds to pay off your existing credit card debts, effectively consolidating them into a single loan with potentially lower interest rates and a fixed repayment term.
A debt consolidation program is a service that’s offered by a debt relief company and it functions similarly to a traditional debt consolidation loan. With this type of program, you work with the debt relief company to obtain a debt consolidation loan (typically through a third-party partner lender) that is used to consolidate your credit card debt into one lump sum loan. Rather than paying the lender directly, you make payments each month directly to the debt relief agency.
How do you qualify for traditional credit card debt consolidation?
Qualifying for traditional credit card debt consolidation typically involves meeting the criteria set by the lender. In general, here are the key factors that lenders consider:
- Credit score: A good to excellent credit score (typically 670 or higher) is often required to qualify and is especially important for getting the best rates and terms on your loan. A high credit score demonstrates to lenders that you have a history of managing credit responsibly.
- Debt-to-income ratio: Lenders generally prefer a debt-to-income ratio of 50% or less. This ratio compares your monthly debt payments to your monthly income and helps lenders assess your ability to take on additional debt.
- Stable income: A steady, verifiable income source is crucial in terms of getting approved. Lenders want to ensure you have the means to repay the consolidation loan.
- Employment history: Lenders typically prefer to see that you have a stable employment history as part of your application.
- Collateral (for secured loans): If you’re seeking a secured consolidation loan, you’ll need to offer an asset as collateral, such as your home equity.
- Total debt amount: The amount of debt you’re looking to consolidate should fall within the lender’s acceptable range. This varies by lender but is typically between $5,000 and $50,000.
Find out how the right debt relief strategy could benefit you now.
How do you qualify for a debt consolidation program?
Debt consolidation programs offered by debt relief companies often have more lenient qualification requirements compared to traditional consolidation loans. Here’s what you typically need to be approved:
- Minimum debt amount: Most debt consolidation programs require you to have a minimum amount of unsecured debt, usually around $7,500 to $10,000, though it varies.
- Type of debt: The debt you enroll in this type of consolidation program must be unsecured, such as credit card debt, personal loans or medical bills. Secured debts like mortgages or auto loans don’t qualify.
- Financial hardship: In certain cases, you may need to demonstrate that you’re experiencing financial hardship and unable to pay your debts as agreed as part of the debt relief enrollment process.
- Regular income: While the income requirements for these programs are often less strict than traditional consolidation, you still need to show that you have some regular income to make the program payments.
- Credit score: Your credit score is less important for these programs, which can make them accessible to those with credit scores in the “fair” range (depending on the third-party lender requirements).
The bottom line
Consolidating your high-rate card debt can lead to big savings for the right borrower. However, you’ll need to meet the requirements to take advantage of what this type of debt relief can offer — and those can vary depending on the debt consolidation route you take. And if you find that you’re unable to qualify for debt consolidation, don’t panic. There are plenty of other debt relief options to consider, all of which can help you regain control of your finances and work toward a debt-free future.
Legislation to expand Social Security benefits to millions of Americans passed the U.S. Senate early Saturday and is now headed to the desk of President Joe Biden, who is expected to sign the measure into law.
Senators voted 76-20 for the Social Security Fairness Act, which would eliminate two federal policies that prevent nearly 3 million people, including police officers, firefighters, postal workers, teachers and others with a public pension, from collecting their full Social Security benefits. The legislation has been decades in the making, as the Senate held its first hearings into the policies in 2003.
“The Senate finally corrects a 50-year mistake,” proclaimed Senate Majority Leader Chuck Schumer, a Democrat from New York, after senators approved the legislation at 12:15 a.m. Saturday.
The bill’s passage is “a monumental victory for millions of public service workers who have been denied the full benefits they’ve rightfully earned,” said Shannon Benton, executive director for the Senior Citizens League, which advocates for retirees and which has long pushed for the expansion of Social Security benefits. “This legislation finally restores fairness to the system and ensures the hard work of teachers, first responders and countless public employees is truly recognized.”
The vote came down to the wire, as the Senate looked to wrap up its current session. Senators rejected four amendments and a budgetary point of order late Friday night that would have derailed the measure, given the small window of time left to pass it.
Vice President-elect JD Vance of Ohio was among the 24 Republican senators to join 49 Democrats to advance the measure in an initial procedural vote that took place Wednesday.
“Social Security is a bedrock of our middle class. You pay into it for 40 quarters, you earned it, it should be there when you retire,” Ohio Senator Sherrod Brown, a Democrat who lost his seat in the November election, told the chamber ahead of Wednesday’s vote. “All these workers are asking for is for what they earned.”
What is the Social Security Fairness Act?
The Social Security Fairness Act would repeal two federal policies — the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO) — that reduce Social Security payments to nearly 3 million retirees.
That includes those who also collect pensions from state and federal jobs that aren’t covered by Social Security, including teachers, police officers and U.S. postal workers. The bill would also end a second provision that reduces Social Security benefits for those workers’ surviving spouses and family members. The WEP impacts about 2 million Social Security beneficiaries and the GPO nearly 800,000 retirees.
The measure, which passed the House in November, had 62 cosponsors when it was introduced in the Senate last year. Yet the bill’s bipartisan support eroded in recent days, with some Republican lawmakers voicing doubts due to its cost. According to the Congressional Budget Office, the proposed legislation would add a projected $195 billion to federal deficits over a decade.
Without Senate approval, the bill’s fate would have ended with the current session of Congress and would have needed to be re-introduced in the next Congress.
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Saturday is the winter solstice and 2024’s shortest day. Here’s what to know about the official start of winter.
The 2024 winter solstice, the shortest day of the year, happens on Saturday, Dec. 21, in the Northern Hemisphere. The celestial event signifies the first day of winter, astronomically.
What is the winter solstice?
The winter solstice is the day each year that has the shortest period of daylight between sunrise and sunset, and therefore the longest night. It happens when the sun is directly above the Tropic of Capricorn, a line of latitude that circles the globe south of the equator, the National Weather Service explains.
The farther north you are, the shorter the day will be, and in the Arctic Circle, the sun won’t rise at all.
How is the day of the winter solstice determined?
The winter solstice occurs because of the Earth’s tilt as it rotates around the sun.
When the Northern Hemisphere tilts away from the sun, the nights last longer. The longest night happens on the solstice because the hemisphere is in its furthest position from the sun. That occurs each year on Dec. 21 or 22.
This year, it falls on Dec. 21 at 4:21 a.m ET, to be precise.
On the summer solstice, when the northern tilt is closest to the sun, we have the longest day, usually June 20 or 21.
National Weather Service
The solstices are not always exactly on the 21st every year because the earth’s rotation around the sun is 365.25 days, instead of 365 even.
Will days start getting longer after the winter solstice?
Yes. Each day after the solstice, we get one minute more of sunlight. It doesn’t sound like much, but after just two months, or around 60 days, we’ll be seeing about an hour more of sunlight.
When will winter officially be over in 2025?
The meteorological winter ends on March 20, 2025. Then, spring will last until June 20, when the summer solstice arrives.
How is the winter solstice celebrated around the world?
Nations and cultures around the world have celebrated the solstice since ancient times with varying rituals and traditions. The influence of those solstice traditions can still be seen in our celebrations of holidays like Christmas and Hanukkah, Britannica notes.
The ancient Roman Saturnalia festival celebrated the end of the planting season and has close ties with modern-day Christmas. It honored Saturn, the god of harvest and farming. The multiple-day affair had lots of food, games and celebrations. Presents were given to children and the poor, and slaves were allowed to stop working.
Gatherings are held every year at Stonehenge, a monumental circle of massive stones in England that dates back about 5,000 years. The origins of Stonehenge are shrouded in mystery, but it was built to align with the sun on solstice days.
Andrew Matthews/PA Images via Getty Images
The Hopi, a Native American tribe in the northern Arizona area, celebrate the winter solstice with dancing, purification and sometimes gift-giving. A sacred ritual known as the Soyal Ceremony marks the annual milestone.
In Peru, people honor the return of the sun god on the winter solstice. The ancient tradition would be to hold sacrificial ceremonies, but today, people hold mock sacrifices to celebrate. Because Peru is in the Southern Hemisphere, their winter solstice happens in June, when the Northern Hemisphere is marking its summer solstice.
Scandinavia celebrates St. Lucia’s Day, a festival of lights.
The “arrival of winter,” or Dong Zhi, is a Chinese festival where family gathers to celebrate the year so far. Traditional foods include tang yuan, sweet rice balls with a black sesame filling. It’s believed to have its origins in post-harvest celebrations.
Researchers stationed in in Antarctica even have their own traditions, which may include an icy plunge into the polar waters. They celebrate “midwinter” with festive meals, movies and sometimes homemade gifts.