At our banks or financial institutions people who deal with the accounting side of things, often say words that are technical, such as bookkeeping or debt consolidations Red Deer. These words are often not understood, if not misunderstood. Especially the phrase debt consolidation.
What is it? There are people that find it hard to comprehend this word, but don’t worry. One of our insolvency trustee Red Deer advisors will make it paramount for you to understand it. Interested? Dive in further and discover debt consolidation and why it is good for you. By chatting with one of our insolvency Red Deer trustees they can get into more details with you and answer any questions that you may have. Call our Red Deer office today for a FREE consultation.
Debt Consolidation Explained
The phrase “debt consolidation” has something to do with debt. This phrase totally means availing new loans or debt to pay something, which may be in the form of liabilities or unsecured consumer loans. To make it simple, it is used to pay off a bulk of liabilities or lumps of debts.
This is one of the popular payment forms nowadays, used by a bunch of people. Well, if you really have a bundle of loans to pay, then this may be your probable answer. But you have to understand that not all creditors grant people this opportunity.
If you’re lucky, then you are blessed with an answer to all those liabilities or loan burdens. Creditors are willing to offer you debt consolidation for various reasons. But this type of loan is not available to every financial institution. They are available at banks, or credit unions, which have the capability to lend you chunks of money.
Two Types of Debt Consolidation
• Secured Loans
This is a loan that is backed up by an asset by the debtor. When you make a loan or a debt consolidation, you throw in your car, your house, your business, or anything that can be used as collateral. So, by the time you are not able to pay, you will be saying goodbye to your precious things as they will be claimed by the bank as your payment.
• Unsecured Loans
Debt consolidations in contrast to secured loans. In this type of loan, you don’t have any assets or resources used to back up the loan. A debt consolidation that is hardtop obtain, and contains high-interest rate supplemented with lower qualifying amounts.
Out of the two, the easiest debt consolidation to get into is the secure one. Regardless of the two, the rates are fixed. And the debt consolidation, or simply the loan that you made must be repaid within 3 to 5 years’ time.
Why Is This A Great Idea?
Well, for some people, this is a great idea to repay some of their unsettled debts or liabilities in one go. But you have to make sure that you will be able to pay the loan within the given time frame. This can be a great help to businesses who are suffering great losses and looking for investment opportunities. Nevertheless, doing a debt consolidation won’t be putting you out of the hole yet, you still have to pay for it.
Debt Consolidation Red Deer Canada may be too technical at first sight, but it is not. In simplest terms, this is a kind of loan, which you make if you are looking for something to solve all your money problems. By speaking to one of our Red Deer insolvency trustees they can clarify all your questions and concerns and keep you away from filing for bankruptcy.