If you are having problems paying your debts and do not want to use your passive income earned from a range of investments like mutual funds, stock trading or CFD trading, then you might want to consider qualifying for a business debt consolidation loan. Debt consolidation is an excellent way to pay off your numerous debts and combine them into a single loan. A lot of businesspeople are able to pay off their debts easily and save some capital for their companies when they applied for a debt consolidation loan. A business consolidation loan can save you money, and here are several ways how:
Low Interest Rate
One of the benefits that a debt consolidation loan can provide is the low interest rate that it offers. Combining your debts into a single loan can provide you with an affordable interest rate, which is commonly several interest points lower than what you are currently paying. For instance, you may have debts that have 15.3% and 16.7% interest rate. If you consolidate them into a single loan with 14% interest rate, that will be a lot of savings for you.
Low Monthly Payments
With a low interest rate, this means that you also have a low monthly payment for your debt consolidation loan. You can have a better cash flow and even save money since you can now afford to pay your payments due each month. Having extra money means you can allocate more financial resources to income-generating investments like a new business, stock market trading, or CFD trading. Moreover, you can also avoid incurring late fees when you have low monthly payments, and you can also speak with your lender to waive it for you.
Debt Management Convenience
Paying for a single loan to pay off all your debts is definitely more practical and convenient than paying for them in separate accounts. With debt consolidation, you do not have to worry about memorizing different payment dates or searching for various bills to pay every month since you only have to make one low monthly payment for your debts. This will save you from the hassles of paying penalty fees, and your creditors will not have any late payments to report to the credit bureaus.
Second Mortgage Gives You Extra Cash
The best thing about acquiring a second mortgage to consolidate your debts is that you can cash out the difference between the value of your loan and the equity of your property. For instance, if you have a $100,000 loan and $250,000 home equity, you can cash out $150,000. You can acquire this amount and use it at your discretion, such as to pay your children’s tuition or to save it for future expenses.
When you finally applied for a second mortgage that will consolidate your debts, avoid acquiring additional expenses so that you will not negate the potential savings that you may have. In addition to this, make sure that you are going to follow your monthly schedule when you acquire your second mortgage to avoid paying for penalty fees and losing your property.