Are Safe Path Advisors and Malloy Lending Legit or Scams?
What type of debt is Safe Path Advisors and Malloy Lending pushing on the public? Why has Safe Path Advisors and Malloy Lending been flooding the market with a different type of debt relief and credit card consolidation offer in the mail? The problem is that the terms and conditions are at the very least confusing, and possibly even suspect. The interest rates are so low that you would have to have near-perfect credit to be approved for one of their offers. Best 2020 Reviews the personal finance review site, has been following Safe Path Advisors, Malloy Lending, Polo Funding, and a bunch of other websites connected to this organization.
What are the Different Types of Debt?
To understand the different types of debt that exist today, you first need to know what actually debt is. In simple terms, when one party borrows money from another, it’s called debt. However, the explanation doesn’t just end there. There are many other elements to debt, including interest rates, additional fees, payment terms, etc. Debt can be a very powerful financial tool if one manages it well. Otherwise, it can turn into a liability that complicates your entire life.
To manage debt well, you first need to understand its type and implications. In this article, we are going to explore tdifferent types of debt and how to handle each of them. Keep reading to learn more!
Secured and Unsecured Loans
There are two broad types of debt, including secured and unsecured loans. Secured loans are the type of debt that involves collateral. Collateral is an asset that the borrower pledges to the debt. In case the borrower isn’t unable to pay off their debt, the lender has the right to take the collateral. The common examples of secured debt are mortgages and auto loans. The house and the car are the collateral in these two loans, respectively.
On the contrary, unsecured loans don’t involve collateral. Credit card loans are a common example of unsecured loans. This type of debt usually has higher interest rates. Moreover, if you fail to repay the debt, you don’t go off-hook easily. Credit companies usually hire a third-party debt collection agency, which takes on the responsibility of getting payments. They can also sue you for not paying, which ends up in your wage garnishment.
Let’s learn more about the different kinds of secured and unsecured loans.
Credit Card Debt
Credit card debt is the most common type of loan. It’s an unsecured debt which comes at a high price. Today, millions of Americans carry credit card debt, and the number seems to be going up each year. Moreover, the sky-rocketing interest rates have made it very challenging for people to make their due payments each month.
If you don’t pay your credit card bills on time, the cost of the debt keeps increasing. Your credit score determines the annual percentage rate on your credit card debt. If you don’t make payments on time, your score gets a hit, and the APR increases, making your debt even more expensive.
Getting out of credit debt is not an easy process. If you’re struggling to make your payments on time, here are a few options that you can consider:
- Consider consolidating your loans if you have multiple credit cards
- Reach out to a non-profit credit counseling company for a debt management plan
- Consider transferring your credit with a balance transfer credit card. They usually offer 0% APR for a set introductory period
- Consider declaring bankruptcy after consulting with a bankruptcy lawyer
Medical bill debt is the unpaid cost of either a regular doctor visit or a medical emergency. Accidents happen, and you may have been rushed to a hospital after breaking a bone or passing out, and now you’re left with a bill that you can’t pay. This can leave you with an expensive debt if you can’t afford to pay it right away.
Medical bills are one of the most common types of debt for which debt collectors are assigned. They are also unexpected, so one can never be prepared beforehand. If you find yourself in such a situation, then you have a few options to pay off the medical bills. Take a look below:
- Negotiate a payment plan
- Consult with a medical bill advocate
- Consider getting a medical credit card (Consider this your last option because this make your bills even more expensive due to the added interest rate)
If you are a fresh college graduate, the chances are that you carry a student loan debt. Student loans are a significant debt that can give you a hard time in achieving financial stability. If not handled properly, you can be paying them off for years to come.
There are two main types of student loans: federal and private. With minor differences, any type of student loan can become a challenge to pay off. If you are struggling to pay off your student loans, then consider the following options:
- Inquire about relief options from your student loan provider
- If you qualify, apply for loan forgiveness
- Consider signing up for an income-based payment plan
Personal loans are another common type of debt that is usually taken to either consolidate loans or finance a particular expense. Long term personal loans usually last for up to 5 years with interest rates ranging between 5% and 36%.
If you’re struggling to pay off your personal loans, then consider the following options:
- Contact your lender and ask if they offer a hardship plan or if they can defer payments
- Get in touch with a non-profit credit counseling agency to help you manage your debt
- Consider talking to a bankruptcy attorney
Mortgage loans are an essential step for buying a home. These loans last over decades and cover the costs of thousands of dollars. Mortgages are a type of secured loan, which means that your bank can seize your home if you are unable to make payments as per the signed agreement.
There are very limited options when it comes to a mortgage. So, if you find yourself struggling, consider the following:
- Try refinancing your mortgage
- Consider getting on the Home Affordable Refinance Program
Managing your debt effectively starts with understanding it. When you’re applying for any type of loan, make sure you understand the terms and the penalties that you could be subjected to, in case you’re unable to repay. If you do find yourself in a challenging position, you can make use of the options that we have mentioned above for dealing with each type of debt.