Loosely defined, it’s the act of combining several loans or debts – usually credit card debt – into one low payment. This can offer two big economic advantages: Lower interest rates and greater simplicity. Both are goals to work toward, and both are decidedly achievable. But how?
Here’s the short-term solution: Consider a debt consolidation loan. It can cut those numerous high-interest debts down to size into one low-interest loan with one fell swoop. But exactly who qualifies for a debt consolidation loan? Do you have to own a home or not? And what about equity…? There’s a little confusion. Let’s clear this up.
Debt Consolidation Loan Options
Consolidating several high-interest loans into one low, manageable payment can dramatically free up your cash. With the extra money you will have, you can feel free to pay more against the principal (and pay off debts earlier), or use the extra cash wisely in other areas where it’s needed.
The important thing is that you make a move to reduce your debt now. The more you wait, the more cash you stand to lose. But, which avenue to debt consolidation is right for you?
Luckily, there are a multitude of debt reduction options available. We’ll run through them for you, so you can decide which best fits your needs.
What you should know before trying to consolidate debt
You’re both worried that your debt is too high, and you’ve decided to do something about it. That’s good. Debt consolidation may save you both time and money. Your next move depends on your own personal financial situation.
Define your goal: lower payment, or faster payoff.
The idea behind debt consolidation is a simple one: several higher-interest debts into a single, lower-interest debt. This can benefit you in two different ways. First, with a lower interest rate, you may be able to lower your monthly interest payments so you have more of your hard-earned cash available for other important needs. Alternatively, a lower interest rate could allow you to apply the interest savings to the principal loan – and pay off the debt faster.
At Acquired Home Loans it's all about choice. Your own bank can only offer you one choice. At Acquired Home Loans we offer you over 200 products from various banks and lending institutions in one simple meeting, saving you time and frustration.
Having a pre-approval from Acquired Home Loans gives you the confidence of knowing exactly how much you can afford to spend and how much it will cost. To find out more about home loan pre-approval, contact us today!
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