Finance

Consolidating Your Debt

August 19, 2020

Are you considering consolidating all your debt?

Are you starting to get overwhelmed with multiple things being debited for your account and wanting to make it easier for yourself? Here at Funding Force we don’t only help our clients obtain new finance, we also want to help them be financially more stable which may mean consolidating your debt.

What does it mean to consolidate your debt?

Consolidating your debt means combining all current debt such as personal loans, credit cards and or other liabilities. Combining all your debt essentially pays off the multiple debt and creates a single loan that you would then pay off. Debt consolidation loans is usually a secured or unsecured loan obviously each one will have its own benefits which we will go into a little further.

What are the benefits?

There are many core reasons that consolidating your debt can be beneficial to you. It’s important to assess your current circumstances to work out what would work best for you. Listed below are the common benefits we find when it comes to consolidating your debt.

– Lowering your repayments
– Able to budget more effectively
– Reduce your costs in repayments e.g. fewer fees, lower interest rates.
– Knowing the end date to your debt
– Dealing with only one creditor instead of several

What are the downfalls?

The good way out the bad in this situation but of course there are always things you should consider when looking at possibly going down this path of consolidating your debt such as:

– Potentially damaging your credit score only if you don’t keep up with your repayments.
– Potentially incurring more debt if you aren’t careful and try to obtain more finance while trying to repay your debt consolidation loan.
– Possibly be paying your loan for a longer period due to consolidating all your debt into one.

If you would like more information and assistance in consolidating your debt call us on 03 9369 0690.

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