Debt consolidation loans – 5 things to remember
| By: David Lynes |
Debt consolidation loans have become increasingly popular over recent years, with more and more people with a range of higher interest debts using a low rate consolidation loan to wrap up their other debts and enjoy increased convenience and affordability. Using a consolidation loan can make financial management far easier and can help you to enjoy more disposable income each month.
Dealing with a large number of debts can be a real hassle, as it means dealing with a range of creditors, making a large number of repayments each month, and often paying high interest rates on debts such as credit and store cards. Having just one lower rate loan makes things far easier and cheaper for most borrowers.
It is important when you are looking for a debt consolidation loan that you find the right loan for your needs and circumstances, as there are many lenders that offer these loans, from banks to Internet lenders, on either an unsecured or a secured basis. Below are five things to bear in mind when looking for a debt consolidation loan:
1. Debt consolidation loans are available on a secured or unsecured basis. However, if you opt for a secured debt consolidation loan you can enjoy longer repayment periods and very competitive interest rates, which can help to keep monthly repayments down.
2. If you have poor credit then the chances of getting an unsecured consolidation loan will be slim, as most unsecured lenders will only look at those with decent credit. However, if you are a homeowner then there is a good chance that you can get a secured consolidation loan, which will enable you to repay existing debts and avoid missed or late repayments that could further damage your credit.
3. A consolidation loan can help you to reduce your monthly repayments by a significant amount but it is important to find a low rate consolidation loan to ensure that you keep your repayments down and do not pay over the odds on interest over the term of the loan.
4. Consolidation loans are available from a wide range of lenders, so it is important that you take the time to compare a range of loans to find suitable interest rates, borrowing levels, and repayment periods.
5. The amount that you can borrow on a consolidation loan will depend on a number of factors. If you opt for a secured consolidation loan the borrowing levels are higher, but the actual amount that you will be able to borrow to consolidate your loans will depend on a number of factors such as your equity levels, your financial and employment status, your credit rating, and other factors.
Loans4 provide Homeowner loans for UK homeowners. We specialise in loans for consolidation of your existing credit commitments enabling you to reduce your outgoings to an affordable level and have just one low APR loan.
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