What is Debt Consolidation?
A debt consolidation loan is a loan that allows you consolidate all your debts into one affordable monthly payment.
What Are The Advantages Of a Debt Consolidation Loan?
There are numerous advantages to consolidating debt, including:
- Replacing all your monthly payments with just one payment, making it easier to budget your monthly income.
- Debt consolidation loans may offer a lower interest rate than the rate you are paying on credit cards, resulting in smaller monthly payments.
- With a lower interest rate, and/or extended terms, you may be able to reduce your total monthly payments or pay your loan off sooner.
How to qualify for a debt consolidation loan?
You must observe the consolidation procedure and meet the following criteria:
- The bank will request a copy of your monthly expenses to determine if you can meet your payment obligations.
- You must be employed, or have a source of income that will enable you to repay the loan.
- The filing of a proposal stays all legal actions undertaken or contemplated by unsecured creditors.
- Your bank may request a co-signor or collateral (house, car, boat etc...).
What is the next step?
To find out if you qualify for a debt consolidation loan, contact your bank or financial institution.
