Is consolidating debt a good idea
Is consolidating debt a good idea - knights of pythias sword dating
In this article, I’m going to explain in very simple terms the basics of debt consolidation.
According to the Government of Canada, “this option [debt consolidation] may be suitable for debts such as those relating to credit cards, public utilities or other consumer loans.This is the cheapest way if you repay within the interest-free or low-interest period.You’re likely to need a good credit rating though to get one of these cards.And when it comes to debt, things become really murky. I’ll answer the questions I hear all the time from 4 Pillars clients including: Debt consolidation involves taking out one big loan to pay off many small loans.Debt consolidation is one of those terms that Canadians have a lot of confusion about. As the Government of Canada’s Office of Consumer Affairs (OCA) explains, “debt consolidation loan is a loan (usually from a bank) that lets you repay your debts to all your creditors at once.You should get free debt advice before you consider taking out a secured debt consolidation loan, as they’ll not be right for everyone and you could just be storing up trouble or putting off the inevitable.
Before you choose a debt consolidation loan think about anything that might happen in the future which could stop you keeping up with repayments.
This means that you only have one monthly payment, often at a lower interest rate than you are paying now.
This saves you money on interest fees and lets you pay off your loan faster.” With debt consolidation, you essentially ask a creditor to loan you one big lump sum of money to pay off all those small debts.
In this guide, 20-year financial expert Paul Murphy takes you through the basics of why Canadians use debt consolidation.
I’ve helped thousands of Canadian families understand how to deal with large amounts of unsecured debt.
Consolidating all your debts into one loan might appear to make life easier but there might be much better ways of dealing with debts.