Cambridge Life Solutions

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Debt Consolidation Loans – Helpful or Hurtful?

Debt Consolidation is often marketed to consumers as a way to roll all your debts up into a single account. In a way, this is accurate, but that sentence portrays debt consolidation as some kind of easy fix – it’s not. Debt consolidation is a new line of credit with a financial institution; usually a home equity loan (the funds backed by collateral, i.e. your house), a personal loan or a credit card. The idea is that you use the money from your new line of credit to pay off all the other debts you owe. At that point, you are left with one single monthly payment instead of multiple ones, making it easier to manage your finances.
www.cic.gc.ca/cambridgelifesolutiondebtsettlement.ca

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Cambridge Life Solutions

  1. 1. Debt Consolidation Loans Helpful or Hurtful ?http://www.ic.gc.ca/app/ccc/srch/nvgt.do?prtl=1&estblmntNo=234567135890&profile=cmpltPrfl&profileId=501&app=sold&lang=enghttp://www.ic.gc.cahttp://cambridgelifesolutiondebtsettlement.ca/
  2. 2. Debt Consolidation Loans Helpful or Hurtful?  Debt Consolidation is often marketed to consumers as a way to roll all your debts up into a single Account In a way, this is accurate, but that sentence portrays debt consolidation as some kind of easy fix – it’s not Debt consolidation is a new line of credit with a financial institution; usually a home equity loan (the funds backed by collateral, i.e. your house), a personal loan or a credit card The idea is that you use the money from your new line of credit to pay off all the other debts you owe At that point , you are left with one single monthly payment instead of multiple ones, making It easier to manage your financeshttp://www.ic.gc.ca/app/ccc/srch/nvgt.do?prtl=1&estblmntNo=234567135890&profile=cmpltPrfl&profileId=501&app=sold&lang=enghttp://www.ic.gc.ca http://cambridgelifesolutiondebtsettlement.ca/
  3. 3. Cambridge Life Solutions  This can be useful for several reasons; one being that interest is only accumulating for one account instead of multiple accounts Meaning you have a relatively concrete knowledge as to what your monthly charge will be and can therefore budget accordingly Secondly, if you qualify for a home equity loan or a personal loan, your interest rate will likely be significantly lower than a credit card, especially if you are currently paying multiple credit cards at varying interest rateshttp://www.ic.gc.ca/app/ccc/srch/nvgt.do?prtl=1&estblmntNo=234567135890&profile=cmpltPrfl&profileId=501&app=sold&lang=enghttp://www.ic.gc.cahttp://cambridgelifesolutiondebtsettlement.ca/
  4. 4. Cambridge Life Solutions If you don’t qualify for a home equity loan or a   Debt consolidation can be a suitable personal loan, there are specialized debt solution to credit card debt, utilities and consolidation companies that are available to similar types of consumer loans help you However, there are some higher risks involved  But it is important to be aware that it is with these types of companies, including higher not necessarily a solution to all your debt rates of interest than other loans – your mortgage, for example, would not qualify If your credit is even remotely damaged, the interest rate you will get on this loan is likely to render negligible any improvement from your  In order to qualify for a consolidation current situation loan, the customer usually needs to have a good credit rating and be financially solvent (i.e. have a sufficient income to be able to make the payments on the loan)http://www.ic.gc.ca/app/ccc/srch/nvgt.do?prtl=1&estblmntNo=234567135890&profile=cmpltPrfl&profileId=501&app=sold&lang=enghttp://www.ic.gc.cahttp://cambridgelifesolutiondebtsettlement.ca/  An unacceptable credit rating will mean you are unable to get a debt consolidation loan
  5. 5. Cambridge Life Solutions  If you have experienced some type of financial  You are reducing the amount of hardship and are having trouble making your payments, it is probably a good idea that you don’t credit you have available, which get a consolidation loan could damage your credit score It might sound simple but there are definite risks involved  However, this is kind of a Catch-22, An integral element in terms of your credit score is because leaving the lines of credit the amount of credit you have available and how much of this credit you are using open will make it very tempting to use them again If you close the accounts once you have consolidated your debts and paid off your existing creditors  If you do this, you can end up with the exact same debt problem plus your consolidation loan for your previous debthttp://www.ic.gc.ca/app/ccc/srch/nvgt.do?prtl=1&estblmntNo=234567135890&profile=cmlPrfl&profileId=501&app=sold&lang=enghttp://www.ic.gc.cahttp://cambridgelifesolutiondebtsettlement.ca/
  6. 6. Cambridge Life Solutions  This could put you in such a financial  In essence, a debt consolidation hole that you are forced to consider more loan can be helpful if you are able serious options to control your spending habits and can afford the monthly payments Such as a debt management plan, a consumer proposal or filing for bankruptcy  However, it is important to consider the risks listed above – If All of these will seriously damage your you have several years’ worth of credit for a significant period of time on-time debt repayment A further option would be debt  And are completely certain you are negotiation, which is a less official form financially responsible enough to be of debt-relief option, but can still impact able to set a strict budget and stick your credit to it, perhaps a debt consolidation loan is a good choice for your situationhttp://www.ic.gc.ca/app/ccc/srch/nvgt.do?prtl=1&estblmntNo=234567135890&profile=cmpltPrfl&profileId=501&app=sold&lang=enghttp://www.ic.gc.cahttp://cambridgelifesolutiondebtsettlement.ca/
  7. 7. Cambridge Life Solutions However, if you have even the slightest worry about not   Debt negotiation can be a great being able to make the payments or being tempted by the newly-freed-up lines of credit available to you, a debt alternative to consolidate loans since consolidation loan is probably not for you debt negotiation programs are not There are a variety of other debt relief options – all will credit score driven (you can have impact your credit in some way, but they also ensure you good or bad credit to qualify) are accomplishing your goal of getting out of debt, Without providing the tantalizing distraction of those  Nor does it require you to securitize freshly-paid-off credit cards, which is one of the primary risks of debt consolidation your debt by a physical asset such as your home or car  No home ownership or equity in your home is required to do debt negotiationhttp://www.ic.gc.ca/app/ccc/srch/nvgt.do?prtl=1&estblmntNo=234567135890&profile=c mptPrfl&profileId=501&app=sold&lang=eng  Debt consolidation can save youhttp://www.ic.gc.cahttp://cambridgelifesolutiondebtsettlement.ca/ interest however debt negotiation can save you thousands in interest but also possibly thousands in the PRINCIPAL amount you owe
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