If you’re managing multiple debts, you probably already know it can be overwhelming trying to keep on top of it all. The pressure of juggling various repayment dates, interest rates, and financial obligations can lead to considerable stress and anxiety.
Debt consolidation loans offer a practical solution, allowing you to combine several debts into a single payment. Not only can this simplify your financial life, but it may also help reduce your overall interest rates and save you money in the long run.
When it comes to lenders who offer debt consolidation there are a lot of options out there, so how can you know which one is best?
Keep reading to learn how to find the best debt consolidation loans and what to consider when choosing a lender.
What is Debt Consolidation?
Debt consolidation is when you wrap up all your high-interest debts into one single loan.
It’s a great way to make paying things back easier and can even help lower interest rates.
By doing this, you can simplify your finances and make life a bit less hectic since you’ve only got one monthly payment to deal with instead of juggling a bunch of them.
This new loan usually comes with a fixed interest rate and a set repayment schedule, making it way simpler to plan your monthly budget.
What debts can you consolidate?
- Credit card balances
- Personal loans
- Short term or cash loans
- Car loans
- Buy-now-pay-later balances
- Overdue bills and fines
- Hire purchases
Benefits of Debt Consolidation
Simplified Payments: When you only have to worry about one monthly repayment instead of a bunch of due dates, it makes life a whole lot easier. It cuts down on the chances of missing a loan repayment, which can save you from those annoying late fees, higher interest rates, and piling on even more debt.
Lower Interest Rates: A lot of people find that their overall interest rates drop when they decide to consolidate their debt, saving them money over the loan term.
Improved Credit Score: When you start making regular payments on your consolidation loan, you’re showing that you can handle credit responsibly, and that can really help boost your credit score!
Stress Relief: Juggling a bunch of accounts and due dates can really stress you out. But with debt consolidation, you can lighten that load and just focus on paying off one loan, helping you get on track and feel better mentally.
Lower Repayments: Combining short-term loans into one long-term loan often means lower monthly payments.
How To Find The Best Debt Consolidation Loan
Not all consolidation loans are the same, so it’s really important to find a reputable low-cost lender if you want to get a good deal.
Find a lender that pays your creditors directly
This way, they’ll take care of settling your loans and handling all the back-and-forth for you. It can also help give your credit score a little lift and keep you from getting tempted to use those funds for something else. Loan Direct takes care of paying off your existing debts to make the whole process super easy for you.
Make sure it will save you money
There might be fees when you consolidate or if you pay your other debts off early, but your savings should be more than those costs since you’ll usually end up with a lower loan interest rate. Make sure to pick a lender that gives personalised rates so you won’t get hit with any sneaky extra charges! Loan Direct offers tailored rates to suit your situation, so you can be sure you’re getting the best deal.
Make sure you can borrow enough
Ensure the lender can cover all your current debts since the amounts can differ. It’s a good idea to shop around for both secured and unsecured loan options. Typically, unsecured loans max out at around $30,000, but some lenders, like Loan Direct, can give you up to $75,000 without needing any collateral.
Flexible repayment terms
Ensure your repayment plan is affordable, allowing savings while keeping payments high enough to pay off debt quickly. Loan Direct offers repayment periods of up to 7 years and as short as 6 months, so your payments will be comfortable.
How Much Could You Save?
One of the main drawcards of a debt consolidation loan is the significant cost savings. Because we can combine your debts into a new loan at a potentially better interest rate, your overall loan payments will be lower than before.
Here’s an example from one of our customers: Jarrod wanted to free up some of his disposable income, as he was paying $469 per week on his debts. We paid off all his debts and got him a debt consolidation loan with a weekly payment of just $235. That gave him $234 extra per week to use however he wanted!
Tamara is another one of our customers. She desperately needed cash to repair her car but couldn’t afford to pay cash to get the work done. She had several existing loans and couldn’t afford any extra loan payments. We managed to get Tamara a debt consolidation loan and give her the cash she needed to fix her car. Her total loan payments were $100 less per week then before!
Use our free online loan calculator to find out how much you could borrow.
Choosing a Loan That's Best For You
Debt consolidation loans are a great way to help people manage their debt and get their finances on track.
Picking the best debt consolidation lender, like Loan Direct, can really help you get better rates and flexible terms that work for you.
With our competitive interest rates and flexible repayment options, allowing you to borrow over a longer period of time, our loans are fair and affordable.
Our simple online application process is so quick and easy – it takes just 2 minutes, and we can usually get approval within 1-2 hours*.
Need to borrow a higher amount? We can help with that, too! Our secured loans allow you to borrow $150,000, and sometimes even more.
If you have bad credit, that’s not a deal breaker. We help people with no-so-great credit scores achieve financial success.
Get in touch with our friendly team today to discuss your situation and find out how we can help.
