When facing a debt problem or dealing with credit card debt, debt consolidation is among the foremost options that people consider. There are some common goals of debt consolidation, and these include:

  • Making one simple payment rather than making paying different amounts to different creditors.
  • Getting debt-free by maintaining a plan to pay your debt off.
  • Repaying it at a lower interest rate compared to the ones being charged on other debts.

You can also file a consumer proposal in order to steer clear of bankruptcy. In general, this process allows you to reach an agreement with the creditors and slash your debts by 75% or even more. At times, people can go beyond their credit limit when borrowing money, which can bring down their credit score. Failing to secure a good credit score can lead creditors and financial institutions to believe that you might not be able to pay back on time. 

 

While we don’t provide services for debt consolidation, we are open to guiding you to the proper resources.

Types of Debt Consolidation

We know it is impossible not to get overwhelmed by mounting debt. Also, when you have started missing your mortgage payments, and debt collection agencies begin to come after you, your sole concern is to get through your payday loans at the end of the month. Here’s what you can do:

  • You can either repay the bank in full with interest.
  • You can also pay the bank at a lower interest rate than you would have been paying on the individual debts.
  • You can also make a decision on the non-borrowing options to consolidate your debt.

Your unique financial goals play a great role in your choice of the best consolidation option from the solutions accessible to you. In debt consolidation, the challenge for many people is that the consolidation lenders often want them to pledge their vehicle or property as collateral for the loan.

Some of the consolidation & borrowing options are:

  • Basic debt consolidation loan from a lender who provides funds for you to pay off your debts.
  • Borrowing against your home equity with a home equity consolidation loan.
  • Balance transfers from a line credit, an overdraft credit or another credit card with a lower interest rate to pay off higher debts.

Improving Your Payment History & Credit Score

To maintain a good credit score and avail lower interest rates on loans, you must follow certain good practices:

  • Make timely payments
  • If you are unable to make the complete payment, pay the minimal amount at least
  • Reach out to the lender immediately if you face trouble in completing a payment
  • Avoid skipping payments even when bills are in dispute
  • Don’t apply for credit way too many times
  • Obtain quotations from multiple lenders as these inquiries would be treated as one single inquiry with regards to your credit score

Many Canadians struggle with debt management and need a professional who can assess and evaluate their financial situation and suggest the right debt help and credit repair solutions.

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