When weighed down by excessive debt, it can sometimes feel like bankruptcy is the only way to finally get back on your feet. Yet many people fail to realize just how serious bankruptcy is. A bankruptcy stays on your credit report for a full decade, severely hurting you chances of acquiring a loan and securing reasonably priced insurance. With more and more employers checking the credit or their employees, it can even harm your chances of getting a good job. For this reason, many homeowners are increasingly choosing to consolidate their debts with the assistance of a private party loan.

Hard money loans are derived from the funds of private lenders, and as a result homeowners typically have a much easier time securing one to consolidate their debts. One of the best and more attractive features of hard money loans is that they are based upon your assets, typically your home, so your credit plays a much smaller role in determining whether or not you are qualified. These private lenders don’t have to adhere to banks’ underwriting guidelines, which gives them the freedom to loan to whomever they choose.

But what, exactly, are the primary advantages of consolidating your debts with a hard money loan over bankruptcy?

Brings Debt Relief Much Faster – While everyone’s personal situation is different, for most people debt consolidation with hard money loans may enable you to be relieved of most of your debt within a matter of a few years. By bringing down your overall interest rate of your debt to a much more manageable level, you are able to pay more of the principal every month, just helping speed your way to debt relief. Compare this to bankruptcy, which stays on your credit report for a full decade, and will probably still affect you for years afterwards. While paying off your debts with the assistance of a private money loan may require a few years of belt-tightening, it hardly compares to the financial frustration you will have to endure if you file for bankruptcy.

Better for Your Credit – Of all the negative marks that can appear on your credit report, bankruptcy is the worst. Financial organizations, insurance companies, and even potential employers approach people with bankruptcy with an extreme degree of caution, and may even refuse to do business with them at all. It’s a tough situation to be in, especially considering for how long it lasts. Consolidating your loans into a single hard money loan and paying it off as quickly as you can is a much better long-term credit strategy.

Saves You Money – Consolidating your hard money loans can save you money on two major fronts. First of all, it typically lowers your overall interest rate, which can save you a ton of money on credit cards, which can easily have interest rate that hover around twenty five or thirty percent. But it also saves you money on future loans if you choose to forgo bankruptcy. If in the future you are able to secure a loan after bankruptcy, it will probably come with an extremely steep interest rate, which can be extremely costly in the long run.

Allows You to Take Control of Your Finances – Filing bankruptcy means that you have totally let your financial situation slip away from you, to the point that there is no way that you can get it under control. But most people can take control of their own life if they simply explore alternatives, such as consolidation with a hard money loan. Consolidating your debts gives you the power to get your life back in order without resorting to bankruptcy.

Getting a hard money loan with bad credit may be easier than getting a standard loan from a bank. It really depends on the individual situation and the lender. Most banks have raised the minimum required credit score for personal loans. If your score is low, you may still be able to get a mortgage for your primary dwelling from a regular bank, but if you are interested in real estate investing, rehabbing or flipping, your application will probably be denied.

For some hard money lenders bad credit is not an issue. It is their business. Some small companies and private individuals specialize in making high risk loans to property owners. The amount that a person can borrow is limited to the amount that the lender can expect to recoup in the case of foreclosure. These are risky deals for both the lender and the borrower, but sometimes it is the only option.

The best advice is to look at your situation carefully. Don’t be overly discouraged by low credit scores, but don’t go around putting in applications at every bank in town. Numerous denied applications will drive you score even lower. It makes you look desperate.

If you have been denied credit based on a low score, you are entitled to a free copy of your credit report. Get it. Check it carefully. There may be inaccurate, old or false information. Even correcting a bad address can add a couple of points to your score. Some people search for a hard money loan with bad credit, because they think that they have no choice. Correcting information on your credit report is the best choice, particularly if you want to invest in real estate, now or at some point in the future.

For real estate investors seeking hard money lenders bad credit scores are not ideal, but private lenders are more likely to take other things into consideration. For example, perhaps you have some experience in flipping properties, but for some reason you credit history is less than perfect. You could have been a victim of identity theft or a difficult divorce. Maybe you have a recent history of making payments on time and repaying promptly, but late payments from years past are still affecting your overall FICO numbers. Once you know it’s there, it may take you months to get the credit bureaus to remove that old information. Those months could cause you to miss out on a good opportunity.

If you explain your situation to the hard money lenders bad credit issues might not prevent you from cashing in on that great deal. Bankers, on the other hand, typically make their final decisions based on the numbers, even though we all know that they are not always an accurate reflection of a person’s creditworthiness. It is that fault in the system that creates one niche for the private lender.

Providing solutions for people with problematic credit is not the only gap filled by private lenders. In fact, it is not even the most common reason that people look for this type of financing. There are advantages to real estate rehabbers that have to do with the time it takes to close, the amount available for the loan and what it can be used for. Both banks and private lenders have different requirements. Even private lenders may take a look at your credit score. Some may require a higher score than others

So, to get a hard money loan with bad credit, you may need to look around until you find the right lender. You may even need to wait a little while or make the effort to correct inaccurate or old information that is still lingering on your credit report. In other words, it may take a little doing, but don’t give up before you even try.

Keeping the household budget under control can be difficult for most families, even those that have high incomes. If you have loans, high credit card bills, debts or lack of finances you may be struggling to budget effectively and this may create family conflict as well as lack of ability to plan for future commitments such as your children’s college funds or sufficient investments to keep you in retirement. Financial awareness is important not just in times of recession but also when spending leads to living beyond your means. These can all be causes of stress and anxiety. Being able to spend wisely is a good way of teaching your children skills for living as well as reducing stress making situations within your family.

Here are some financial tips that can help you if you are struggling with sorting out family finances or if you want to reassess what you are doing with your income and expenditure.

Personal Finance

You may be surprised that if you sit down and work out exactly what your outgoing’s are in relation to your income in an honest way you can begin to become clearer about how to budget to meet your needs. Many people go through their adult life not being aware of their real income and expenditure and remain distressed month after month when there is a short fall. Some people stay consistently in debt just because they are too scared to do the math. If you want to lessen this feeling of panic then consider personal financial counseling, it will help you to sort out your concerns and assist you to start getting control without needing to go to the loan sharks. If things are really worrying consider debt consolidation if needs be but do not put your head in the sand. However, If you have money left over after doing budget monitoring then you should consider putting it into a savings account to obtain interest not blowing it all at once. There are also personal finances software and free family budget planners which you can use on line to help you assess your family spends including monitoring over time.

Saving money

Most people will need to save money for big expenditures, such as education fees, the purchase of property or to buy a car for example. The earlier on in life you can start saving the better because of the “law of compound interest”. This states that you make money on the interest your savings gives you as time goes by. But this really only works if you do not touch the money you are saving for some considerable time, usually all your working life and that you invest regularly. Most people unfortunately are not in this position, and you should not do it if it caused strain on your overall budget, but shorter periods of saving and ad hoc amounts when you can afford it will still give you better results than if you did not save at all and had to take out a loan.

Credit cards

Pay off your credit card bills before you consider putting your money in a saving account or in any other investment. In fact if you have money in a savings account and have unpaid credit card bills it doesn’t make sense not to pay your lenders as the interest charged on credit card and store card debt is many times the amount than the interest that you can get from saving your money in the bank or in a savings account. You can always start saving again but if you have debt hanging around over your head this will continue to have an emotional impact on you and your ability to be in control of your finances.

Some people play the credit card swap game of transferring debt from one card to another at zero interest rate for a limited time, and then swap to another just before this cards interest rates rises. There are many benefits of doing this and the credit card companies encourage it by offering cash back, air miles and other rewards but you should do it with caution because as if you are not able to keep track of the time when the interest free only time runs out and swap cards you will have to pay the full rate which as we know, is very high.

Saving accounts

Not all savings accounts are born equal and you should research the best one for your needs, but do not let that stop you from embarking on regular saving. Even if you think you have found the best savings account a new deal may come on the market, however make sure that paying any early penalty withdrawals is worth the effort of swapping accounts.

Family Insurance

The best type of insurance to invest in for your family, over and above the obvious such as house, car and medical insurance should be the kind that meets your family’s unique needs. Dental insurance, pet insurance, musical equipment insurance maybe the types of insurance that without it your family’s crucial day to day wellbeing would suffer, not just as an extravagance but a necessity. But assess all of the insurance covers you have taken out and make sure where some overlap you are not paying out twice for cover such as for payment protection plans on loans credit cards, lost keys, travel insurance.

Discount Finders

Families are really getting wise to the benefits of buying products and services online as there are huge discounts to be made by buying this way. In addition there are online websites and forums where daily discount vouchers can be found. Price comparison sites are also useful to compare prices and get the best deals on line when you are shopping.

As a family you can work together to understand your budgeting needs and how you spend and prioritise what you need. Lessen the stress of financial issues by getting good money advice and seeing what makes the difference for you.