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Published on February 4th, 2014 | by Pete

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Could Consolidating Your Debts Change Your Life?

Juggling debt is one of the most stressful situations you can find yourself in, whether you have unintentionally racked up your credit cards or have had to depend on loans to maintain your lifestyle. High interest rates, the fear of not being able to make repayments and the hassle of keeping on top of due dates and minimum payment amounts, can all take their toll on an individual borrower. Debt can truly take over your life, leaving you overwhelmed and deflated each time you look at your bank balance.

Fortunately, there are ways to get yourself out of debt. If you’re looking to make a start on debt recovery soon, debt consolidation may be a realistic solution and the starting point to a debt-free future. Debt consolidation is best achieved with the use of a debt consolidation loan. This consists of a cash sum lent to you for the immediate payment of all your individual debts. Once these debts have been repaid, there will only be one account outstanding – the loan amount. Your new focus will be on repaying just this one repayment each month. Not adding to your debt is crucial at this point.

When you’re used to the stresses of multiple credit repayments every month, just one repayment can be a real life changer. Everyday budgeting is a lot more straightforward. You will be able to know exactly how much you owe on your loan each month and when the payment will be taking. All your other household expenses can be budgeted around this. When you consolidate your debts in this way, you also remove the pressures of dealing with numerous creditors and will now only need concern yourself with the consolidation loan lender.

Peer-to-peer services, like Zopa debt consolidation, is the most popular choice for those looking to get out of debt in this manner. Peer-to-peer lending, or social lending, allows debtors to completely bypass traditional banks while still getting low competitive loan rates.  Applications are made online and can be approved in as quickly as 24 hours.  When paying off individual debts, particularly when paying just the minimum payment each month, it’s easy to accumulate interest charges quickly.  With one personal loan you’ll have a set period of time, usually between two to five years, to repay the debt in full, with much lower interest rates to boot. 

Though consolidating your debt is certainly not a quick fix to multiple debts – and really there is no consequence-free fix to being in debt – it does allow for both immediate and long term relief. The psychological toll of debt should not be underestimated. Knowing that you have multiple debts, and therefore multiple creditors to deal with, can be debilitating. Consolidating these debts into one amount makes approaching your debt easier. The amount to to repay is still the same, but the interest charges over time become greatly reduced when the interest rate is lower.  With a consolidated loan, you can approach your debt in a more straightforward, more organised way. Debt consolidation allows a debt-free future to come into view again.

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