Debt Consolidation Loan
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Before the Debt Collectors Come round – Take Out a Debt Consolidation Loan
Are the bills piling up neatly on the kitchen side? Are you too frightened to open the credit card bill, the auto loan statement, the mortgage statement? Do you think that if you ignore them they might just go away? You need to stop this train of thought now and consider taking out a debt consolidation loan.
You are not alone
The first thing you should realise is that you are not alone in having unmanageable debt. Total consumer debt is currently over $2 trillion. This eqates to nearly $19,000 per household as there are close to 106 million homes in the United States.
Beat debt before it beats you
The important thing is to make the self realisation that you should manage your debt before it starts to take over your life. The last thing you want is to miss several mortgage payments and have your home repossessed, or skip credit card payments and end up being earmarked as a bad credit risk. By taking out a debt consolidation loan you will be able to pay off all your existing unsecured debts such as credit cards and car loans.
What are the advantages of a debt consolidation loan?
Are there any disadvantages?
Will I qualify for a debt consolidation loan?
A debt consolidation loan otherwise known as a home equity loan is a secured loan. This means that the loan is secured against collateral, such as your home. If you do not own a home, it is unlikely that you will qualify for such a loan. If this is the case, you will have to consider taking out a personal loan or consumer loan. These are unsecured and will still have lower interest rates than you are currently paying across all of your debts.
The most important thing to remember is that although such loans as a debt consolidation loan may provide an immediate remedy to financial difficulties, you have to remain firm. Do not take out other supplementary loans and start flashing the plastic once again or you will end up in a far worse situation than you first found yourself in.