Once you have made a household budget you can determine if you have enough money to repay your debts on your own. If your budget shows that you are paying a lot of money each month towards your debts, a debt consolidation loan may be the next step towards solving your money problems.
A debt consolidation loan is a loan you get to consolidate your other debts. If you owe $15,000 on five different credit cards, and are making five different payments each month, it may be possible to get a debt consolidation loan for $15,000 to repay all of your credit cards.
The two biggest advantages of a debt consolidation loan are that now you only have one monthly payment instead of five, which makes budgeting easier, and you may be able to negotiate a lower interest rate, which saves you money and allows you to repay your debts faster.
A lower interest rate is only possible if you have good credit or security, such as a car or house, or perhaps a co-signer with good credit. If you do own a home, consulting a mortgage broker is a good way to see if you qualify for a loan.
If you have good credit, consider a debt consolidation loan as a way to deal with your money problems.
If you don’t qualify for a debt consolidation loan, the next option to consider may be credit counselling.
Talking to an expert about your personal situation can help. Contact an expert today for a free evaluation and see if debt consolidation is your best solution.