Debt Consolidation
Debt Consolidation & How Does It Work in Ontario?
Debt consolidation loans are used to pay smaller loans, credit card balances, overdraft balances, bills, and even payday loans. Debt consolidation refers to acquiring a new loan to pay out all these smaller loans and debts. This helps bring all high interest outstanding debts and loans to one low interest rate lump sum and therefore one smaller monthly payment.
How can Debt Consolidation help you in having a healthy financial portfolio?
Having a healthy financial portfolio is important when applying for a mortgage loan. Owning a large amount of debt can negatively impact your credit score which can result in a higher interest rate mortgage or not getting approved for a mortgage at all. If you own a home in Ontario and have built up equity you can refinance your high interest rate debts such as credit card debt, secured and unsecured line of credits, car loans and any other high interest rate loans into one lower rate payment.
Esi Ghassemi can help you transfer your “bad debt” into “good debt”. He can assist in saving you high interest payments and increase your monthly cash flow by decreasing your monthly payments. Get in touch with Esi Ghassemi today to review your options.
Frequently asked questions
How Do Debt Consolidation Loans Work?
In a word, debt consolidation is combining many debts into a single loan with a single monthly payment. If you hold a substantial amount of credit card debt, you are likely accruing a substantial amount of interest. You may eliminate all of your high intrest debts by merging them into a single low interest loan.
I have bad credit. Can I still qualify for debt consolidation?
Yes, however it is considerably more difficult to get a consolidation loan if you have very poor credit. Creditors evaluate risk based on credit ratings and payment history. If you have not consistently been able to pay your current bills, the majority of lenders will see this as a red signal.
What debts can be included in debt consolidation?
A: Credit cards Loans
B: Unsecured lines of credit
C: Prperty tax and or Utility bills
D: Medical bills
E: Any high intrest loan such as payday loans
F: Car Loans
Does debt consolidation affect my credit?
By appropriately handling your debt, a Debt Consolidation Program, when followed and finished successfully, will actually boost your credit in the long term. In addition, once you are debt-free, you consolidating your debt will put you on the fast road to credit restoration.
How can you determine whether you need debt consolidation?
If you owe money to many creditors, it makes sense to consolidate debt. You should have sufficient debt that you struggle to make payments, but not so much that you would never qualify for a personal loan.
Can debt consolidation save me money?
Yes, you may save money on your monthly payments if the interest rate on your new loan is lower. Consolidating your debts into a single payment might also make your payments more affordable and reduce the likelihood that you will miss a payment.
