A debt consolidation loan is a loan which basically allows you to consolidate many of your debts into one. Let’s say you have 5 credit cards and want to eliminate your credit card debt. By getting a debt consolidation loan you can pay off your 5 credit cards and leave yourself with only one payment to make each month instead of five.

There are many advantages to getting a debt consolidation loan:

• A Debt Consolidation Loan is likely to have a lower interest rate than your credit cards. This will reduce your total payments and save you money.

• An extended term for your Debt Consolidation Loan can reduce your monthly payments.
• You can save time and make your budgeting easier by only having to make one monthly payment instead of many.

Will I Qualify for a Debt Consolidation Loan?

The following must be met to qualify:

• The lending institution will need to see a copy of your monthly budget to determine your ability to make monthly loan payments.

• You must have a source of income. This can be a regular job or some other legitimate source of income.
• To meet prerequisites of the lending institution for a debt consolidation loan, you may need to find a co-signer or guarantee the loan with collateral such as a house or a car.

Now all you need to do is contact your bank or any other lending institution to see if you qualify. The easiest way to reach major banks is though their website. If you don’t have an internet connection, you can use your library’s internet or the yellow pages. If you are a house owner, you can contact a mortgage broker.
If you cannot qualify for a debt consolidation or refinance loan, don’t be disappointed as there are other solutions such as debt settlement.

Posted in Debt Consolidation