If you are struggling to pay your debts then applying for consolidation loans is one of the possible solutions to your problem.
Our panel on consolidation specialists are on hand to answer any questions that you have regarding consolidation loans and you can contact them by following the link above to the loan form. They should be back in touch with you very soon and you can start your road to financial freedom!
So What Are Consolidation Loans?
Consolidation loans can be either secured or unsecured and are used to pay off your high interest unsecured debt and roll these up into one, cheaper loan. When you enquire about our consolidation loan services you will be asked to combine all of your current unsecured debts such as credit card debt, medical bills etc. Our experts will then call you back and give you options that can help you get out of debt quickly and get back to a normal life.
Some Advantages To Consolidation Loans
There are many advantages to consolidation loans, as well as disadvantages, lets take a quick look at the plus points first,
- By combining your debt into one payment and lowering your interest rate, you are in a position to repay your debt off more quickly.
- Having multiple debts is stressful, this disappears with one loan that provided you can keep up with repayments
- If you keep up the consolidation loan repayments, the amount of debt collection calls with be zero
- By lowering your repayments, you will have free cash to start to enjoy life again
- Using this loan type for credit card debt consolidation can save a lot of interest payments
- Because you can keep up with payments all of the nasty late payment fees will be eliminated
- You are basically setting up your own debt repayment plan, stick to it!
Some Disadvantages To Loan Consolidation
Credit Card Debt Consolidation
As with most things, there are good and bad points, here are
some disadvantages to consolidation loans,
- You are basically taking on a new debt, you must make sure that you repay all of your current debts otherwise you will be in an even worse position
- You must be careful to get the best rate possible, a high rate will defeat the purpose
- Many times the debt is stretched out over a longer period, meaning that they payments are easier to make but the actual debt may cost you more in the long run
- Only unsecured debts can be used when applying for the debt consolidation loan
- You must make up a new plan to stop you getting into debt again! Just because you have consolidated your credit card debt doesn’t mean that the problem won’t return
Normally, the most damaging type of debt that consumers rack up is credit card debt. The interest charges from credit card debt can range between 11% to over 30%, the latter range is very high and you could find yourself repaying the interest charges of the credit card while unable to tackle the principle debt amount. These interest rates don’t even take into account the extremely high credit card penalty charges that you could receive for missing payments . For these reasons, if you are suffering from this type of debt then a credit card consolidation loan may be the best course of action. You could lower your interest amounts with a debt consolidation loan and have a fixed repayment rate, allowing you to budget for household items and day to day living expenses.
Other Options to Consolidation Loans
A consolidation loan will not be the right choice for everyone that is currently in debt. There are other options available that can help such as Chapter 7 bankruptcy, Chapter 13 bankruptcy, debt management and debt settlement. Speak with a financial expert to find the best plan for your needs.
There are many reasons why people in debt will want a consolidation loan, consider your options, make a list of all your debts, their interest rates and such. Then you should be able to understand your situation more fully and make an informed decision.