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Debt Consolidation - Know More
Debt Consolidation is often advisable for those who are paying credit card debt. Because credit cards charge a high rate of interest, it can pretty soon get out of hand. At such times it is advisable to refinance...
 
We often require money we don’t have. At other times we overspend on our credit-card, and are unable to pay it off. Sometimes we are in dire straits, unable to pay off loans taken for some important reason (say medication). At such time what we need is the facility of Debt Consolidation. Debt consolidation entails taking out one loan to pay off many others. This is generally done to avail a lower interest rate, or for the convenience of servicing only one loan.
Debt consolidation can simply be done from a number of unsecured loans into another consolidated unsecured loan, but often it involves a security of an asset that serves as collateral security, which is most commonly a real estate property. The collateral security provided for the loan allows a lower interest rate than without any security, because by collateralizing, the asset owner agrees for a foreclosure of the property in order to pay the loan back. The risk to the lender becomes less and the interest rate lower.
Debt Consolidation is often advisable for those who are paying credit card debt. Because credit cards charge a high rate of interest, it can pretty soon get out of hand. At such times it is advisable to refinance and reschedule the loan from another financer (typically a bank). When provided with collateral, a lower rate of interest can be availed, as the risk to the issuer is reduced. This strategy would not help those who have a habit of overspending, as they would run up a steep debt again. One should, however, be aware of what is called ‘predatory lending’ – borrowing from someone at bad terms due to lack of time or knowledge of market.
In this section of 01webdirectory, we provide links to resources ranging from FAQs, to consolidation advisors, to refinancing institutions.
 
 

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