Mortgage & Real Estate Articles

What is Debt consolidation?

Lately debt consolidation has been growing due to the needs of the consumers. It is a tool that helps you better manage your finances leading to great savings of up to 70% of your monthly debt.

The high cost of credit cards adds to the financial burden of the consumers, who find themselves, buried under a heap of high interest credit cards. This tool is a great way to reduce your monthly spending and the time spent doing it.

It is a simple concept actually. A management company takes most of your outstanding debt like credit cards, small loans, etc…and comes up with a loan that pays them off. This loan, which should be a low interest loan, will save you as we mentioned earlier up to 70% of your monthly debt, over a certain period of time.

In essence you have consolidated all your various payment into one monthly payment at a lower rate, thus saving the difference.

It is always wise to discuss this feature with your mortgage consultant who is trained and experienced in this field. This tends to lower your debt ratio which in turn might enhance your chances of getting your loan approved, and funded in a timely manner.

Noel Francis

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