Debt Consolidation in Canada – Is a debt consolidation loan the right solution for you?
What are the advantages of a Consolidation Loan?
- Protect your credit rating for the future
- Pay less interest
- Make only one monthly payment
- Get out of debt sooner
What is Debt Consolidation?
Debt Consolidation – what is it? If you are struggling with multiple debt payments, debt consolidation can help you to combine your payments into one single monthly payment.
Not only will this help you with managing your debts it will save you money on interest charges.
A debt consolidation loan is usually a personal loan that allows you to consolidate your unsecured debt such as credit card debt, lines of credit, overdraft protection on your bank accounts and maybe even your car loan in to one manageable monthly payment.
We recommend that you make your payments Bi-weekly that way you will save even more money on interest charges as you will be paying down the principal every time you make a payment.
How do I get a Consolidation Loan?
How to get a consolidation loan? In Canada we have several forms of debt consolidation the most common one is a line of credit from your bank or credit union. Since you already have a relationship with your financial institution, that is the first place to start. You are already their customer so they know who you are and how you handle your money, and they will be able to tell you very quickly if you qualify or not for their consolidation loan program.
If you are a home owner you may want to try to refinance your mortgage and roll all of your debt into your monthly mortgage payment. If you consider this solution we recommend that you use a Mortgage Broker rather than trying to do this on your own – Mortgage Brokers can get you a better deal than you can get yourself.
What are the disadvantages of a Consolidation Loan?
- High Interest costs
- Having to get a co-signer
- Having to allow security over your assets
- Borrowing money to pay money
If all else fails you may want to try a finance company. The interest rates will be higher, maybe even 3 to 4 times what a Bank or Credit Union will charge you – however, if you are saving on credit card interest you may still be ahead. Only borrow what you need and can afford to pay back in a reasonable time frame.
Great alternatives to Debt Consolidation Loans
For Government licensed debt management you will want to speak with a Licensed Credit Counselling agency.
Debt consolidation programs are available in addition to debt settlement programs. Debt counselling or Credit Counselling agencies do not lend money – they consolidate unsecured debt and negotiate with your creditors to have the interest stopped and or reduced – in order to get you out of debt even faster.
Debt Management Programs are only available through Government Licensed Debt Counselling Agencies.
If you are in debt and need help to get out of debt – speak to these highly recommended Government Licensed Debt Management professionals, among the best and most respected in the industry. Don’t wait until you are forced into bankruptcy, call today!