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What is debt consolidation ? What does it mean ? We are talking about a financial product that allows you to assemble all the various loans and bring them together in a single and all-encompassing loan. Therefore, the previous debts are extinguished and only a loan is obtained, with a single installment credit assist.
Main features
We will now present the main features of consolidated debt. Consolidation is usually granted when there are several short-term debts with a smaller amount. This option allows you to obtain only a debt with a longer maturity than the other loans. Therefore, a useful opportunity, especially when it is difficult to pay off the debt and pay the installments . In a nutshell, the customer is offered the opportunity to pay a single monthly installment each month whose amount is lower than the sum of the various previous loans. Obviously, the period of time it takes to pay off the debt, in this case, is greater.
Consolidated debt has further interesting aspects. This is a loan that usually extends over a medium-long period of time. This is for the reasons we have just explained. The interest rate is around a percentage similar, if not even lower, to previous loans. It can be requested in the presence of original short-term loans.
Who is it for?
Debt consolidation is usually aimed at individuals in possession of certain requirements. Banks prefer to deal with individuals with good income.
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