Why Taking a Debt Consolidation Loan Might be the Panacea to Your Never-Ending Multiple Small Loans…
Whether you are at the edge of bankruptcy or simply trying to manage your finances better, it’s obvious that at one time or another you must have thought about consolidating your numerous smaller debts into one manageable loan. But is it worth it or is it another way of sinking deeper into debt?
Here’s a quick primer.
1. Single Payment Equals Cheaper, Quicker Repayment
Debt consolidation in its most basic definition involves taking out one loan and pay off smaller loans in other accounts. In a day and age where the consumerism culture is deeply entrenched, a lot of people have multiple credit accounts and credit cards with relatively huge balances on them. Naturally, keeping track of such multiple deadlines and payments can be a nightmare particularly when you are trying to make your life manageable by paying off all debts. By consolidating those loans into one, you can stop worrying about several deadlines and make one or two payments every month towards clearing your loan with one debtor. The fact that you will have only a single loan to handle makes repaying quite easier as you won’t have to constantly debate and antagonize yourself on which account to pay off first.
2. Less Stress, Less Hassle.
You will sleep better at night knowing that you owe only a single entity money rather than a bunch of irate creditors who can’t seem to stop reminding you that you owe them money. Additionally, debt is one of those factors that can contribute significantly to a stressful life. By taking a relatively bigger loan to pay off smaller ones relieves you from the stress of having to worry about debt and can thus focus entirely on other aspects of your life.
3. Put an End to Debt Collection Calls.
Another good reason of consolidating your loans is to stop collection calls from creditors who think you have defaulted on their payments. If anything, one they suspect you have fallen back on the repayment of a lot of debt, most of them opt to turn over your accounts to a debt collection agency. After this, you will start getting a lot of collection calls every day that can be quite stressful and annoying. Taking our a debt consolidation loan makes it easier
4. Better Interest Rates.
By consolidating smaller debts into one manageable loan, you can save a lot of money on interest, particularly if you have plenty of credit cards that have maxed out. Most credit card issuers will typically charge higher-than-normal interest rates as compared to other rates on the market. By consolidating these and paying them off in a single sitting, you can avoid incurring multiple unnecessary charges and also bargain for a cheaper interest rate when taking out the bigger loan.
5. Significantly Improves Your Credit Score.
Debt consolidation can improve your score, especially if you are constantly making multiple late payments on your credit card accounts – which significantly hurts your credit score. On the other hand, if you can consolidate your debt into one account, it is easier to stay on the course of your repayment plan and rebuild your credit score within a few years.
That said, for best debt consolidation debts, don’t hesitate to contact Mr. Broker and regain your credit viability today.