Debt. Nobody likes it but yet most of us have it. However, that doesn’t mean you have to live with it forever. In fact, paying off your debt as quickly as possible is a very wise and prudent choice. As such, if you have multiple debts spanning across a variety of lenders, then debt consolidation may be a smart move for you to get on top of these tallies and better manage them – especially if you plan on applying for a loan.

Whether you’re applying for an equity loan in Alberta, or anything else, consolidating your currents debts prior to the application process is worth your consideration. But at this point, you may be wondering…

What is Debt Consolidation?

Debt consolidation is the process of taking out a new loan in order to pay down other, smaller debts. Consequently, this combines all of your debts into a single monthly payment plan. The concept of merging all of your debts together fosters the loan name – consolidation. But in all actuality, you can’t really merge your loans together due to many nuanced details such as interest rates, terms, conditions, etc.

As such, consolidation loans provide a larger payout which allows you to repay the smaller loans that you want to consolidate. Typically, consolidation loans are used by people to pay down debts on expenditures such as bills, credit cards, payday loans, and more.

Reasons to Consider Debt Consolidation Services

There are a variety of reasons why people consolidate their debts – everything from lower interest rates to uncomplicating their financial life. View the list below to see which reasons most appeal to you:

  1. Disentangles Your Finances: Rather than paying down (and constantly monitoring) several debts simultaneously each month, you can bring that down to just one with debt consolidation services.
  2. Saving Money With Lower Interest Rates: Approval for a low interest rate consolidation loan can help you pay down high interest debt, and as a result, put more money back into your pocket.
  3. Simplifies Your Life With Smaller Monthly Payments: You can take advantage of this benefit if you consolidate your debt at a reduced interest rate and have more time to pay back your loan.
  4. Pay Off Your Loans Quicker: An important caveat to keep in mind with this is that it can only work if you get a reduced interest rate while ensuring your existing debt payment remains as it is right now. As a result, this will permit more of your monthly payouts to go directly to the principle (the debt) of your loan.

Final Thoughts

Debt consolidation has its merits and validity. As such, if you’re someone who enjoys uncomplicated processes that can result in more money in your pocket – then you may want to look into debt consolidation services before applying for a new loan.

If you’re interested in learning more or need assistance getting approved for a loan, be sure to get in touch with us today.