What are consolidation loans? In short, these are loans whose purpose is to pay off other financial liabilities (loans, credits, credit card limits). Thanks to the consolidation loan, we repay one installment, the amount of which is often lower than the sum of installments repaid earlier.
There are two types of consolidation loans on the market: secured mortgages (in their case, among the loans repaid there is a housing loan) and those with which we repay only loans and cash advances or debt due to credit card transactions.
In this article, we’ll deal with the second type of consolidation loan. We will check what are the differences between individual offers of this type, what benefits customers from this form of financing can count on and what special attention should be paid to. We invite you to read!
Where can I pay my loans back?
TV loan, holiday loan, used credit card debt limit or overdraft. You don’t have to convince anyone how many maturity dates of various installments and repayments are and how easy it is to get lost in it all.
Is there any way to simplify this matter, and additionally try to turn your existing commitments into new ones – cheaper? The solution in such a situation is to consolidate repaid loans and credits!
Consolidation also allows you to get extra cash. So not only can we pay back current loans, but we can receive additional money to use for any purpose! We checked which banks offer the most popular consolidation loans:
What are the financing conditions?
The most important elements of the banks’ credit offer, to which, as customers, we pay attention are definitely price parameters. What conditions can customers expect to consolidate their obligations?
- Good Finance provides a loan with an interest rate of 14.49%, with a repayment period extended up to 10 years and a maximum amount of up to USD 150,000!
- Honest Bank offers its commission-free loan with a low-interest rate (only 15.49% for amounts up to USD 150,000) until the end of January 2013!
- With the loan granted by Cooperative Bank, we can repay up to 8 credit products. At the same time, it tempts with a low-interest rate, the possibility of repayment even in 84 installments and a maximum amount of up to USD 150,000;
- Honest Bank offers a consolidation loan of up to USD 150,000 with an interest rate of 10% and a loan term of up to 8 years!
- As part of the Good Finance offer, we can get a loan with an interest rate of 7.99%, up to USD 80,000 and a repayment period of 6 years.
When is consolidation unprofitable?
One should always look at all bank loan offers as closely as possible. It may turn out that under the cover of well-exposed and glossy elements of the offer hide parameters or criteria less spectacular … And these include, among others:
- Commission for granting a 4% loan charged by Good Finance. It should also be added that the interest rate of 14.49% applies only to customers of this bank for options with insurance and loans in the amount of over USD 100,000 … The interest rate for new customers without insurance is as much as 23.99%!
- The requirement to have or set up a personal account and fund it with income from income, imposed on borrowers by Honest Bank;
- The maximum loan amount for new customers is limited to USD 80,000 by Cooperative Bank. Only people who are already customers of this bank can count on a loan of up to USD 150,000;
- Determining the minimum amount of consolidation loan available at Honest Bank at USD 2,000;
- Low interest on the consolidation loan (7.99%) granted by Good Finance offered only to customers with the best creditworthiness assessment result. The maximum interest rate can reach up to 20.99%.
Pay one installment comfortably, save time and money
If you want a low installment and repayment of only one liability instead of several, the consolidation loan proposal seems to be perfect!
Due to the fact that such loans can be granted for a very long time, even for 10 years, and their maximum amounts can reach up to USD 150,000, the vast majority of those interested should be able to take advantage of such an offer.
Low-interest rates, often even no commission or the possibility of obtaining additional cash make it worth considering such offers.