If you’re looking for a better way to manage your cash flow and reduce your debt faster, you should consider consolidating your loans into a debt consolidation mortgage. With consolidation, all your loans are placed into one simple loan payment. There are many ways that this can help you can improve your financial situation. Here we look at all the benefits of debt consolidation and the ways it can help to make your life easier and put some money back into your pocket.
Reduce Interest Costs
By consolidating your debt, you will have the opportunity to obtain a much lower interest rate than what you were paying with combined balances. The lower interest means you will have lower monthly payments. This will be beneficial to those who are struggling with their regular monthly payments or for those who would like to pay back their debt faster.
Avoid Credit Card Debt
Let’s face it, credit cards come with some really high interest rates. If you consolidate your credit card balances into one favourably low rate, you will save money on your overall monthly finance charges.
Having numerous debts can get confusing when it comes to managing all the different payments. Plus, if you accidentally miss a payment you could be left with high fees to pay and damage to your credit rating. With consolidated loans, you have one easy payment each month, which is much easier to manage than multiple ones.
Help to Track your Balances
It’s often difficult to know your exact balance when you have multiple loans – rarely are they posted in one place. Not only is this bad for tracking purposes but can also make it difficult to understand exactly how much money you owe. Having one balance through one institution will help you to track your debt more clearly.
Eliminate High-Interest Debt
By merging some of your debt into one loan, you can turn around and pay off some of those higher interest loans, like credit card debt, to save money. This means moving over all amounts to the consolidated lower interest rate loan so you now will have interest building on the new rate and instead of the higher rate.
Debt consolidation can help you save money and reduce your monthly payments. With so many benefits of consolidation, talk to your Financial Forum mortgage broker who can help you better manage your finances and put you on the right track to a debt free life.