Many Ontario homeowners are juggling multiple credit card and loan payments. With home prices and the costs of goods steadily increasing, it appears that household debt will continue to rise.
A debt consolidation loan with Tembo Financial is an easy and cost-effective way to free up your cash flow and manage increasing debts while allowing consumers to save money over the long run.
What is a debt consolidation loan?
Debt consolidation is a type of debt refinancing where a client acquires a new loan to pay off multiple high-rate consumer debts into one simple payment. Interest rates are often much lower with the single loan versus balancing multiple high interest debts like credit cards.
Oftentimes, people who are struggling with large debt often see a significant drop in their overall credit score. This ripple effect makes things very complicated for the individual whenever they are looking to purchase large ticket items like financing a car or refinancing their homes.
A debt consolidation loan from Tembo Financial allows you to leverage the equity of your home to pay down debts faster while simplifying your finances.
Advantages of Debt Consolidation Loans
A debt consolidation loan is an excellent tool for an individual with multiple debts with high interest rates and/or steep monthly payments – especially when amounts are upwards of $10,000+. Getting a debt consolidation loan combines these multiple payments making it much easier for the individual to manage just one monthly payment. The individual often pays a lower interest rate which ultimately lowers their monthly interest payments.
One of the greatest advantages of a debt consolidation loan is the potential for an individual to increase their credit score. This is extremely important because many companies such as cell phone providers, car dealerships and even gyms look at a person’s credit score to determine if they have a strong history of repaying debts. Having a high credit score allows individuals to be approved for many essential purchases they make in their everyday lives.
To summarize, the main benefits of debt consolidation loans are:
- Save Money (By lowering overall monthly interest rates) *
- Avoiding Bankruptcy or Consumer Proposal
- Maintaining and improving your credit score*
- Putting your home equity to work for you
*All debt consolidation loans are subject to credit and underwriting approval. Loan amounts and interest rates change based on a borrowers situation. There are no guarantees that the outcomes from a debt consolidation loan will be the same for all clients.