How Debt Consolidation Loans Can Improve Your Credit Score
Are you heavily in debt? Are you looking for credible options to escape the debt trap? Well, you can be assured that you are not alone and there is a very good method that can really help you pull yourself out of the predicament. That method is debt consolidation, and Cashco Financial can help you easily take care of your debt consolidation with a flex loan today.
According to Statistics Canada (report published in CBC news portal), in the fourth financial quarter of 2015, an average Canadian household had $1.65 in debt for every $1 of disposable income. It is quite a troubling stat, isn’t it? Canada also has a very high number of credit cards per adult consumer. According to a report published by Global News, the delinquency rates for non-mortgage loans have risen sharply in the first three months of 2016 from the previous year. Much of it has been attributed to the global oil glut leading to a sharp fall in oil prices and loss of jobs in the sector. Although you may not be the only person in debt in Canada, you should also make it a point to get yourself out of this mess as quickly as possible rather than waiting for good times to show up. This article will explain why debt consolidation is the most sensible option.
If you need debt consolidation, give Cashco Financial Flex Loans a try
Installment loans have a number of very obvious advantages over short-term, single-payment payday loans. We at Cashco encourage the use of term loans over payday loans because an installment loan has multiple benefits while a payday loan is quite limited. That is why Cashco has brought you a moderately long installment loan called a Flex Loan that can cover your personal needs. You can borrow up to $5000 and repay in 36 monthly, bi-weekly or weekly installments. You can also discuss your specific needs with our Loan Associate and choose terms of payment that are tailored for your needs. Flex loans are highly customizable because hey, they’re flexible. Personal loans of longer tenors are believed to be more customer-friendly due to lower rates of interest, lower amounts of payment per installment, predictability, and convenience. Flex loans fit this description perfectly and are also one of the best Canadian online loans available in the market. This makes it an obvious choice for thousands of Canadians every year.
Benefits of Debt Consolidation Loans
Consolidation loans are of two types. They can be secured loans or unsecured loans. Secured loans are the ones where you need to pledge a valuable asset as collateral and the interest is considerably lower. However, in case of non-payment or delinquency, you risk losing your asset for good. Unsecured debt consolidation loans are much safer because you haven’t pledged a valuable asset that you may lose but the interest on the loan will be higher.
However, there are personal debt consolidation loans like Cashco Flex loans which are even available to people who don’t have the most ideal credit score or total debt service ratio. Let us now look at some of the advantages of debt consolidation loans that will help you to clear your bad debts.
- Single Payment: Many Canadians have multiple credit cards and other debts that they need to worry about. That means, you have to make multiple payments at different times of the month or year and it is often chaotic and you may even forget and overshoot the deadline inadvertently. You also have to maintain individual records separately. A debt consolidation loan takes care of all your other debt accounts and you have to concentrate on a single account which is more convenient. These have longer tenors and you also have to pay less per installment.
- Lower interest: Due to consolidation, the interest may reduce as you pay off some high-interest debts and you are left with a significantly lower-interest debt account. In most cases, your credit card may have maxed out and as you have rolled over your loans multiple times, you have to pay additional money in the form of a penalty and also agree to a higher interest rate. All these problems get settled with a debt consolidation loan.
- Save your credit score and also reduce your stress: The moment you start defaulting or making late payments, your credit score starts taking hits. Most lenders report the problem to credit bureaus and as the score worsens, you limit your chances of a future loan. A debt consolidation loan puts an end to the problem and every time, you make a payment on time, your credit score also improves that much. Moreover, many lenders hand over your case to debt collection agencies once you fail to make payments for a number of days and these agencies start making multiple calls and visits to harass you and realize the debt. A consolidated debt loan can protect you from all these problems.
Conclusion
A debt consolidation long-term loan makes a lot of sense for people with bad credit scores and deep into debt. It can also save you from the embarrassment of declaring yourself bankrupt and gives you more time to settle your debt.
