Get Out of Debt: Understand How Debt Consolidation Can Help
Paying off any and all debts is never an easy task! For those with credit card debt, overdue bills, and student debt, it can be a challenge to pay off the remainder of their debt, especially for those on a low income. To that end, an increasing number of Canadians are turning to debt consolidation to assist them in getting out of debt faster while lowering their debt load. Given that, debt consolidation can be an incredible resource for reclaiming control over your finances!
If you suffer from debt on a low income, you may want to consider consolidating your debts into a single, manageable monthly payment. Instead of paying multiple high interest rates, you could pay off the remainder of your debt with a RenFi secured loan of up to $150,000. After that, you will make a single monthly payment for all debts, saving you a significant amount of money in interest over time. If this sounds like something you may be interested in, then this article is for you. Provided that, this article will explain what “debt consolidation” is so you can make a more informed financial decision.
Having said that, many of you may be wondering where to begin. To start us off, it’s critical that you grasp the fundamental concepts of debt consolidation so that you can better evaluate if debt consolidation is the best option for your needs. To that end, we’ve put together an article with some insight from the experts at RenFi Capital as to what debt consolidation is, how it works, why you should consider it, and how to apply.
After all, it is our goal to help educate and teach our fellow Canadians about the many facets of debt consolidation loans, and we hope that by the end of this article, you will have a better understanding of what RenFi Capital Debt Consolidation Loans are, how they work, and how they may benefit you. Keeping in mind that the main objective here is to save you money on interest and assist you in getting out of debt sooner. To that end, let us begin!
The Fundamental Concepts of Debt Consolidation
A debt consolidation loan, also known as a “bill consolidation loan,” is a financial method used by consumers with multiple debts to pay off their existing debts that combines or “consolidates” many high-interest loans into a single low-interest loan. It helps consumers who have various unsecured commitments, such as credit cards, medical bills, or personal loans, to simplify their finances and save money. This form of loan is frequently used to consolidate excessive credit card or high-interest loan balances. In fact, these loans were designed specifically for individuals who wanted to pay off many high-interest loans over a longer loan period.
Many lenders, including traditional banks and peer-to-peer lenders like RenFi Capital, provide debt consolidation loans as part of a payment plan to borrowers who are struggling to manage the number or amount of their outstanding debts. Unsecured personal loans account for the vast majority of debt consolidation loans (which can be used for any purpose). However, certain lenders, such as RenFi Capital, may allow you to acquire a secured personal loan using your home as collateral. In this scenario, if granted, a secured personal loan gives you access to more cash (up to $150,000), as well as a lower interest rate than your credit and income would ordinarily allow, leaving you with a single monthly payment to your debt consolidation loan provider.
How Debt Consolidation Works
Typically, a lender would provide you with a debt consolidation loan to assist you in streamlining your debt repayment process. Provided that, consolidating your debts is a legal and ethical strategy to better your finances and get out of debt faster. To that end, a debt consolidation loan is a sort of personal loan that works by combining many types of debts or liabilities into a single payment. If you are approved for a debt consolidation loan with RenFi Capital, the funds will be used to pay off any high-interest debt you may have. You will then owe a single low-interest balance on the increased loan amount, with rates starting at as low as 0.75% monthly.
The payback durations for these loans typically range from 2 to 5 years, depending on the amount borrowed. These types of loans also remove late payment penalties and interest charges, leaving you with a single low-interest loan to repay over the course of 2–5 years. All RenFi Capital debt consolidation loans are secured personal loans provided on home equity with a 12-month duration and are closed loans repayable with no penalty after three months. This means that if you take out a RenFi Capital loan, it will be secured as a first or second mortgage on your house. To that end, while a debt consolidation loan will not completely remove your debt, it will simplify your finances, allowing you to save money on interest payments and improve your cash flow in the long run.
IMPORTANT NOTE: Keep in mind that a debt consolidation loan may be declined if you have a poor credit score or blemishes on your credit report. Furthermore, it is critical to remember that debt consolidation loans cannot be used to repay certain forms of debt, such as vehicle loans and mortgages.
Why You Should Consider Debt Consolidation
Debt consolidation is a smart financial decision for individuals with many high-interest debts or monthly payments, specifically for those who owe $10,000 or more. As a result, debt consolidation becomes advantageous when you can get a reduced total interest rate. This allows for lower payments and frees up funds for greater payments, savings, or investments. Finally, debt consolidation can help you save money on interest payments, coordinate, and manage your monthly payments, while lowering your monthly payments to a more manageable amount, making it an exceptionally wise financial decision for any homeowner.
To that end, if you are a homeowner and are dealing with debt, RenFi Capital offers the ideal financial solution to simplify and minimize your debt while saving you thousands of dollars in interest each month. Provided that RenFi Capital is the lender for all submitted loans, they can accept and fund your loan promptly with no draws, inspections, or problems. Furthermore, because all of their debt consolidation loans are secured personal loans, obtaining a loan with RenFi Capital is simpler and provides higher payouts, lower interest rates, and cheaper monthly payments.
That being said, if you are still not convinced as to why you should consider debt consolidation, below, we have outlined a variety of additional benefits to further assist you in determining whether debt consolidation is the best option for your situation. Please read on for more information.
Additional Benefits to Debt Consolidation
- Organizes Your Finances:
Consolidating multiple outstanding debts into a single loan reduces the number of payments and interest rates you can handle at once. As a result, you will save more money on interest each month. Specifically, when the interest rate on your debt consolidation loan is lower than the interest rate on your present debt, which is frequently the case.
- Debt Repayment Made Easier:
Instead of handling numerous individual debt payments each month, a debt consolidation loan requires the borrower to make a single low-interest monthly payment to the lender. It may also reduce the number of collection calls from various creditors received by consumers. As a result, it makes debt management easier and less stressful for clients.
- Accelerated Repayment:
You can pay off your debt faster with a debt consolidation loan. If the interest rate on your debt consolidation loan is lower than the interest rate on individual loans, and you use the money saved on interest to pay down your loan. Keep in mind, though, that debt consolidation frequently results in lengthier loan terms, so you’ll have to make a point of paying off your debt early to take advantage of this benefit.
- Reduced Interest Rates:
Consumers can save money by decreasing their total interest rate with a debt consolidation loan. This is accomplished by refinancing high-interest debt with a bigger, lower-interest loan. It is crucial to note, however, that certain forms of debt have greater interest rates than others. As a result, combining debts into a single personal loan may result in reduced interest rates on certain debts while increasing interest rates on others. In this instance, it’s advisable to concentrate on overall savings.
- Monthly Payment is Reduced:
When you consolidate debt, your overall monthly payment will likely drop since future payments will be spread out over a new, possibly longer loan period. While this may be advantageous in terms of giving much-needed breathing space and monthly budgeting, it also means that you may pay more over the life of the loan, even if the interest rate is lower.
- Credit Score Improvement:
When you apply for a new loan, the rigorous credit investigation may temporarily lower your credit score. Once approved, debt consolidation may help you improve your credit score in a variety of ways. Given that paying off revolving lines of credit might reduce the credit usage rate shown on your credit report, your usage rate should ideally be less than 30%. Furthermore, making consistent, on-time payments—and eventually repaying the loan—can help you improve your credit score over time.
NOTE: When contemplating a debt consolidation loan, keep in mind that it may be a viable alternative only if your credit score has improved since applying for the initial loans. If your credit score isn’t good enough to qualify for a lower interest rate, consolidating your debts may not make sense.
How to Apply for Debt Consolidation with RenFi Capital
RenFi Capital’s straightforward and secure application procedure is designed to make applying for a secured debt consolidation loan as simple and stress-free as possible! All you have to do is provide RenFi the name and amount of the loan you wish to pay off, and they will take care of the rest! It should be mentioned, however, that all RenFi secured debt consolidation loans are secured by a second mortgage on your home. To that end, you or the co-applicant must be the registered owner of the property that will be used as collateral in order to apply.
Furthermore, unlike typical debt consolidation loans, RenFi Capital secured debt consolidation loans do not require onsite appraisals or document submissions such as bank statements, mortgage paperwork, or tax records to be authorized. Furthermore, our innovative onboarding method, which includes no onsite appraisals, a streamlined application procedure, and a completely secure digital experience that is 100% confidential, enables us to remove the roadblocks that slow down the loan process.
Follow these three easy steps to apply:
Step 1: Three-Minute Application Procedure
Step 2: Approval Process in 15 Minutes
Step 3: Funding Amount Approved
When you choose a RenFi Capital secured debt consolidation loan, we will be there for you every step of the process, from beginning to end. That means we’ll be there for you from the minute you apply until the loan is funded, serviced, and paid off! RenFi Capital will provide you the required closing documents and instructions once the application procedure is complete. Additionally, because they are mortgage documents, you and a lawyer must review them and return them to us once they have been completed. After that, RenFi Capital will refund you within 24 hours of receiving the closing documentation.
Consolidate Your Debt and Get Relief Today
RenFi Capital Debt Consolidation is the right financial solution to simplify and minimize your existing debt while saving you hundreds of dollars in interest each month, for those struggling with debt on a low income. Simply put, debt consolidation gives you a fresh start by helping you to pay off your debts more quickly. It removes late payment penalties and interest costs, leaving you with a single low-interest loan to repay. This may entail extending your repayment time by several months or even years, but if it means sticking to the repayment plan, the extra interest payments are worth it in order to get out of debt.
That being said, we hope that after reading through this article on debt consolidation, you will have a better understanding of the fundamental concepts of debt consolidation, why you should consider them, and how to apply for them with RenFi Capital. However, for more information, or support in applying for a debt consolidation loan today, feel free to visit RenFi Capital’s website, their experts will be happy to assist you in any way they can!
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