10 May, 2023
Debt Consolidation,Mortgages Comments Off on Streamline Your Finances: Understanding Which Debts Qualify for Consolidation

Have you ever had to manage various debts with different interest rates, payment due dates, and minimum payments? 

It can be difficult and frustrating to manage, not to mention the financial strain it puts on you. This is where debt consolidation loans come in.

But what exactly is debt consolidation, and which debts can be consolidated?

Debt consolidation loans are intended to make your financial life easier by merging all of your debts into a single loan with a single monthly payment and a fixed interest rate. Debt consolidation loans are frequently used by those who are seeking to cut their interest rates, lower their monthly payments, and make it easier to keep track of their bills.

In this article, we’ll look at which debts can be consolidated, so you can decide if this financial strategy is beneficial for you. 

Credit Card Debt

Credit card debt is the most popular sort of debt involved in debt consolidation loans. One of the most common reasons customers seek consolidation loans is a high credit card balance. Consolidating your credit card debt into a single payment will save you money on interest and help you pay it off faster.

Credit Union unsecured Debts or Credit Card Debts

You can include credit union unsecured debt or credit card debt in your debt consolidation strategy as well. Credit union obligations are often unsecured, which means no collateral is required. Consolidating your credit union obligations into a single payment will help you save money on interest and make your payments easier to handle.

Retail Store Credit Card Debt

Retail store credit card debt can also be included in your debt consolidation plan. Retail store credit cards sometimes have high-interest rates, and consolidating them can help you save interest money while paying off your debt faster.

Unsecured Personal Loans

Unsecured loans, sometimes known as unsecured personal loans, are loans that are not secured by assets such as your home or vehicle, or by another person co-signing for your repayments. You can use unsecured personal loans in your debt consolidation plan.

Payday Loans

Payday loans are short-term loans that must be paid back on your next payday. They frequently have hefty interest rates, making repayment difficult. Payday loans could be used in your debt consolidation strategy.

Auto Repossession Debt

If you have fallen behind on vehicle loan payments, you may be allowed to incorporate them into a debt consolidation plan. Consolidating auto repossession debt with other obligations might make it easier to manage your payments.

Home Equity Loan

You could also incorporate a home equity loan into your debt consolidation plan. A home equity loan is a loan that is backed by the equity in your home. Consolidating your home equity loan with other obligations might save you money on interest while also making your payments more affordable.

Loans with a high interest rate

If you have high-interest loans, you can include them in your debt consolidation plan. Consolidating your high-interest loans will save you money on interest and help you pay off your debt faster.

Utility bills, cell phone bills, and gas cards

You may be able to incorporate overdue utility bills, cell phone bills, or gas cards in your debt consolidation plan. Consolidating your bills will help you manage your payments more easily and prevent late fees and penalties.

Non-government student loans

A private or non-government-insured student loan debt that is stressing your finances can often be consolidated. Consolidating your student loans can make your payments more manageable.

Medical Bill Debt

Not all medical bills are eligible, but many are. Consult your credit counsellor to find out if your medical debts are suitable for consolidation. 

Other unsecured lines of credit

If you have other unsecured lines of credit, such as personal lines of credit or overdraft protection, you can include them in your debt consolidation strategy. 

In conclusion, debt consolidation can be a useful tool for managing your debt, but it’s important to understand which debts can and cannot be consolidated. If you’re feeling overwhelmed by debt and don’t know where to turn, don’t hesitate to reach out for help. At Cashin Mortgages, we can help you understand your options and create a plan to get your finances back on track.

Take the first step today by scheduling a consultation by clicking here.