Here’s Why You Should Look into a Debt Consolidation Loan

Young couple looking for a debt consolidation loan on their laptop in their living room

28 Aug Here’s Why You Should Look into a Debt Consolidation Loan

For many, a debt consolidation loan seems like a solution for other people with more financial know-how. This is an unfortunate misconception. The reality is, debt consolidation is a practical and effective means to regain control of your finances.

If you’re struggling with overdue bills, credit card payments, or emergency expenses, debt consolidation could put you in a far more empowered situation. Continue reading to learn how.

1. Easier to manage

Rather than navigating multiple accounts to several companies, adding up different bills at different times to keep track of how your payments are affecting your bottom line, debt consolidation gives you a single, fixed payment to a solitary lender. This makes your outstanding debt fundamentally easier to manage, reducing the risk of an oversight resulting in even more late fees and higher interest on outstanding credit. Putting all your eggs in one basket also makes it easier to negotiate if you need to make a change to payment plan down the road.

2. Lower your interest rate

Late bills and outstanding credit card payments collect interest over time, and some collect more than others. If you’ve fallen behind on some of your payments, you could be adding to the late fees on top of everything else, and this interest can add up substantially. Probably the most significant benefit of consolidating your debts is that you streamline all your interest. By paying off all your outstanding debts with a debt consolidation loan, you eliminate late fees and reduce your overall interest, resulting in a lower overall cost.

3. Boost your credit score

Outstanding bills and late credit card payments can negatively impact your credit score, making it harder to borrow or resulting in higher interest rates on future loans. Alternatively, making timely payments on your debt consolidation loan can actually boost your credit score, making it a win-win for you! You both eliminate your late payments and begin making punctual ones, so the benefit is two-fold.

4. Less risk of collection or repossession

If you have fallen behind on debt payments, you may be at risk of collection agencies getting involved. This can greatly destabilise your life and cause a lot of stress. Perhaps the collection agencies are already calling. In any case, bringing all your accounts currently by consolidating them will give you a welcome reprieve from their involvement. By making your debt consolidation loan payments on time, you can be confident that the calls from collection agencies and threats of repossession will be a thing of the past.

5. Lower the stress levels

What does all of this add up to? Ultimately, less stress. Your finances shouldn’t demand all your time and attention. By consolidating your debts, you afford yourself more time to live your life, enjoy your free time, and relax. We all know that stress from one aspect of your life can seep into others, affecting job performance, relationships, and hobbies. The peace of mind you gain from a debt consolidation loan could do more than help with your current debts. It could give you the confidence and the focus to improve your future finances. Give yourself a break. You deserve it.

Debt consolidation from a lender you can trust

Max Loans is one of the most trusted names in personal finance NZ wide. If outstanding bills and unpaid credit card debt are dragging you down, seek out a debt consolidation solution from a lender who will put your interests first. With competitive rates and terms, our debt consolidation loan will help you take back control. Contact Max Loans today to learn more!

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