Having three or more debts that you need to pay on time can be difficult, confusing and stressful. This can lead to you missing repayments and struggling to control your budget.
A debt consolidation loan is one common way to help you deal with this situation and get back on track with your cash flow.
Debt consolidation is a form of refinancing all existing debt by taking out one new loan. One or more loans will be paid off with this one single loan, making it easier to manage monthly repayments.
Debt Consolidation loans allow you to bring all your outstanding debts together, with the aim of minimising your repayments and borrowing costs.
Debt consolidation loans will allow you to repay several debts with one large loan. You simply use the loan to repay as many debts as necessary.
For example, say you have a credit card debt of $2000, some buy now pay later debt totaling $1000 and a personal loan you used to pay bills and it has a debt of $5000.
Each debt may have a different monthly repayment amount and interest rate. These debts all have different due dates too, remembering when each debt is leaving your account and how much the repayments are can quickly become unmanageable.
This is when you’d take out a debt consolidation loan. You’d consolidate all 3 debts into one personal loan, and manage one singular repayment.
Debt consolidation can be very beneficial when done well. Here are the key benefits:
If you have multiple loans that you need to repay, there is a higher chance of you missing a payment which could impact your credit score.
Taking out a debt consolidation loan can help you avoid this. And it’s listed on your credit report like any other loan, it won’t affect you negatively unless you default on the repayments.
At Fair Go Finance, our debt consolidation loans are quick, easy loans which you can use to combine a range of debts and loans, including:
And at Fair Go, we’ll personalise your debt consolidation loan, with custom rates and terms that work for you and your life. Apply now.