More and more people use loans and various types of loans. On credit, we buy not only apartments, cars or a dream vacation, but also more and more often we borrow to finance temporary whims, such as fashionable clothes or the latest electronic gadgets. The ease of obtaining a quick loan means that we buy impulsively and often without thinking about the consequences. Too hasty and ill-considered financial decisions resulting in taking out several loans, which seem small and easy to pay back, may in effect affect the stability of our home budget.
When it turns out that we have to repay a total of several or even several installments a month to various loan companies, it can not only overwhelm us with the amount of all liabilities. With more installments that we have to pay back in a month, it’s easy to get lost in the jungle of deadlines and the different amounts of installments resulting from different interest rates on each loan. In such a situation, it is easy to pay back late, which may result in a significant increase in interest rate or expose us to contractual penalties.
The straight way to financial problems
If the number or amount of installments begins to significantly burden your home budget or negatively affect our financial liquidity, it is not worth waiting for the situation to resolve itself. Taking another loan to pay off other obligations is a simple path to the credit loop, which generates troublesome situations, threatens with insolvency and even debt collection.
In such a situation, the best and often the only solution is a consolidation loan that combines all liabilities into one. Thanks to this, we have only one lower installment to pay, which does not burden the household budget.
Mortgage – as collateral for consolidation
The bank granting the consolidation loan may require real estate collateral. However, for people who do not have their own home or apartment, consolidation without a mortgage is also available.
A consolidation loan without a mortgage
A consolidation loan without a mortgage is most often granted for a shorter period of time than a loan with real estate collateral. It also combines with a slightly higher interest rate. However, in under-gate situations, it is often the only good solution that helps to get out of dangerous financial problems, normalize the budget and restore a sense of financial security.
In the case of an unfavorable credit history, high debt and no mortgage, our creditworthiness in the eyes of the bank decreases. Then, independent applications for a consolidation loan are most often denied. However, it is not worth giving up and in such a situation it is best to use the help of a professional credit advisor who will help you obtain an optimally tailored consolidation loan.