Consolidation Loan: Multiple Debts Merged, No More Headaches

By: Gordon luca

Debts are the burden you must shed before they drag you down and affect your personal life. And especially if you have multiple debts clutching you, debt consolidation loan is the way the experts vouch for. This is so because the very design of these loans is meant to pull you out of your bad situation. The basic advantage you get with consolidation loan is consolidating all the other debts, making it easier to manage them under a single account, by virtue of their having one deadline and a single interest rate.

As far as the two basic types of consolidation loans, is concerned, they are secured and the unsecured types.

Secured consolidation loan involves pledging your property as collateral. This is a temporary arrangement till the time you pay off your loan amount with interest. This is the assurance a borrower gives to the lender for repayment, as his property is at risk of repossession, in case he is unable to repay the amount mutually agreed upon. Due to the risk the borrower undertakes, the borrower also gets many benefits from the lender such as low rate of interest as charged on the loan and a longer repayment period, thereby conveniently bringing down the monthly payable instalments. This type of loan also involves a property evaluation process since the loan amount the lender is willing to sanction depends on the equity of your home.

Unsecured consolidation loan do not require a collateral. However, the rate of interest is expectedly high with a short repayment period.

Online availability of these loans have further eased the task of borrowers because of enhanced accessibility and convenience, such that the borrower has to just fill out the online application form and wait for the loan officers to call. The loan officers also guide people in bad debts and how to resolve them by applying for the consolidation loan best suitable for them.

Headaches
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 

» More on Headaches