Would your finances benefit from a debt consolidation loan?
Debt consolidation lenders who keep the best interests of their customers in mind, like Symple Lending want all of their customers to understand the answers to these five frequently asked questions.
What is a debt consolidation loan, exactly?
Debt consolidation loans repay all of your existing debts with a single, new loan that has a single monthly payment. The payment on your debt consolidation loan is lower than the sum of the individual payments you are making now, and it comes at a lower rate of interest. This allows you to repay your debts faster, and eliminates the problem of simply overlooking a payment when it is due.
If you are under financial pressure, most experts agree that a consolidation loan is your best option.
Why should I take out a personal loan to pay off my credit cards?
There is a very simple reason to take out a personal loan, in the form of a debt consolidation loan, to pay off your credit cards.
As Nerd Wallet points out, the interest rate on your consolidation loan is fixed — it won’t go up — is fixed, while the interest rate on your credit cards is not. Credit card interest rates have been going in just one direction for years — and that direction is up.
What kinds of debts can I pay off with a consolidation loan?
In addition to credit card debt, many customers of companies like Symple Lending pay off higher-rate payday loans, loan company loans, auto repair bills, medical bills, moving costs, home repairs, and emergency treatment bills from the vet. You can always ask companies like Symple which debts can be included.
What are points?
Points are a percentage of your consolidation loan takes out of the loan proceeds up front as a kind of loan origination fee. For instance, if a $25,000 loan had a 4% origination fee, you would get $24,000 in loan proceeds, but you would need to repay $25,000 in principal.
Not every lender charges origination fees or points, especially if you otherwise have good credit, but you are just having trouble keeping up with your bills. Be sure to ask about loan origination fees or points before you sign on the dotted line to get your debt consolidation loan.
Is a debt consolidation loan a good idea for me?
The perfect time to get a debt consolidation loan is before you really need it.
If you need fewer bills to juggle, or if you are feeling stressed out about your financial obligations, or if you just need some time to catch up from unexpected expenses, look into getting a debt consolidation loan. You can save hundreds or thousands of dollars in interest with lower rates from your debt consolidation lender. You can use your debt consolidation loan to get your finances on a secure footing, so you actually get ahead, eventually free from debt.
