Best 2020 Reviews provides expert reviews for consumers looking to consolidate their debts. A particular website, Pine Advisors, is of interest to best2020reviews.com. Pine Advisors, also known as Colony Associates, Alamo Associates, White Mountain Partners, , started a new branded website. Pine Advisors and pineadvisors.com are part of the new wave of Personal Loans companies that are marketing to American consumers. Generally, they engage consumers through direct mail, cold calling and internet ads.
Credit card consolidation is the costliest in terms of borrowing money. They make it simple and easy to borrow money due to the highly liquid nature of the money. Younger people who are susceptible to impulse purchases are likely to become addicted to the ease of spending money they don’t currently own.
When it comes to credit cards, the smartest course of action is to have no credit cards at all. You can have one credit card if you want to account for emergency payments, but it should be used for emergencies only.
Your financial life becomes much more manageable when you have one less thing to worry about. Credit cards, for all the flexibility they purportedly bring, make it too easy to fall in debt. It becomes a concern when you depend on them to pay for just about everything, from grocery bills to gas and utility bills, entertainment, and shopping clothing.
Most households wouldn’t find themselves in a financial stumbling block if they use their credit cards with discipline. The idea is to spend reasonably and pay off the debt before the end of every month. If nothing else, at least pay more than the minimum payment and don’t accrue more unneeded debt.
How to Determine if You Have too Much Debt
The most efficient way to calculate if you have too much debt is to use a formula known as the debt-to-income ratio or DTI.
This is the formula: recurring monthly debt / monthly income = DTI ratio.
The debt ratio can be determined in two ways, one includes mortgage, the other excludes it. The one including mortgage is often used by creditors to approve or reject a loan.
So for instance, let’s assume your debt payments every month are equal to $4000 and your monthly income is $8,000. The math for that is 4000/8000 = .50 or 50%. This is extremely high. You have way too much debt that you can handle.
Lenders prefer to work with individuals who have less than 35% or less after including mortgage or rent payment.
The other method to determine DTI is to exclude mortgage payment. The resulting number should be less than 10% and not more. Anything larger should be a serious cause for concern.
How to Fix a Bad DTI Ratio
The best way to fix things is to lower your expenses and try increasing your income. Unfortunately, old habits die hard. Even though you may end up increasing your income, some people respond by increasing their expenses. This makes it harder to play catch up with debt and they find themselves caught in a vicious cycle.
How to Seek Help
If you feel you are too overwhelmed with your debt, the last thing you should do is to seek out quick fixes.
Things such as loans that promise no credit check must be avoided at all costs. It is important to realize they will make your situation worse, and not better. The best thing you can do is contact a nonprofit credit counseling agency that will try to seek lower interest rates on your credit card. This is known as debt management, and should usually take 3 to 5 years, leaving you debt-free at the end.
