If you’re one of those people who struggle to manage all of the debts you owe, perhaps it may be good to start rolling them all into a single, consolidated loan instead.
Debt consolidation is a service wherein a person can put all of their existing debts into one loan. For many, this can be a great way to manage all of their repayments, especially when its interest rate and fees are lower than their other debts.
Is Debt Consolidation A Good Idea & The Right Choice For Me?
Deciding to consolidate your debt is a big financial decision that no one should take lightly. The reason for this is that you need to assess your current financial situation first. Aside from that, you need to know what options you can take and which of them would suit you best.
At Yes Loans, we can experts who can help you weight-up your financial situation, create a budget plan and identify the best ways moving forward and if debt consolidation is right for you. Our loan consultants can provide you with guidance to assist you in making the best choice.
In essence, you will want to choose debt consolidation if you:
Can afford to pay off all existing debts
Debt consolidation works by restricting your debt load but doesn’t reduce the overall debt that you owe. Make sure that whatever plan you choose, your monthly income is sufficient enough to cover it.
Can pay your debts even for a long time
Your income isn’t the only thing to think about, it should also be able to last for some time. When consolidating debt, you ideally lower your monthly payments since you’ve stretched your balance over a longer period. If you have an unstable job, it may be difficult to sustain the repayments you need to make each month.
Things to Do Before You Consolidate Your Debts
Getting a debt consolidation loan can be useful if this means that you will be paying less in terms of fees and interest rates moving forward. However, it can be a short-term solution if you aren’t able to meet the new repayment amount for this new loan.
So before you decide on refinancing with a lender to assist you in your debts, here are some things you need to do before you sign any debt consolidation agreement:
Compare interest rates and fees
– it’s important that you make sure you aren’t paying more for the new consolidated loan that you plan to sign up for. You can do so by comparing interest rates, fees and other expenses against your original loan.
Review the terms carefully
– keep an eye out for longer loan terms. Despite the interest rate being lower on a new loan, paying off a short-term debt for a long time means that you will be spending more money in the long run.
Ensure that the company is licensed
– make sure that the broker you plan to deal with is not operating illegally. Check that they are licensed accordingly before you proceed.
We offer some support to anyone who feels overwhelmed by their financial strains and wants to at the very least start the conversation around debt management. Having helped thousands of businesses expand their operations with business loans we also see the downside of the finance industry. Financial stress can really put your world into a spin with the overwhelming feelings associated with financial stress. Yes Loans have a very experienced debt management team and are here for you.
What are the Benefits of Debt Consolidation?
When done correctly, a debt consolidation loan can result in some amazing benefits for the applicant. These include:
- Simplifying all of your financial obligations in terms of debts owed
- You will only pay a single loan to one agency rather than juggle multiple loans
- Lower monthly repayments are to be expected, allowing you to have more financial freedom
- You can also benefit from lower interest rates
So what are you waiting for? Contact us now at Yes Loans to learn more about how we can consolidate all of your debts and if doing so is the right choice for you!