Are you having difficulty repaying your monthly payments? Would you like to regain control over your finances and optimize your repayment capacity? Know that there are several solutions allowing you to reduce your monthly payments, thanks to the centralization of loans. Through this publication, we return for a moment to the advantages of the consolidation of credits, whose main function is first and foremost to avoid you the box of over-indebtedness.
Loan centralization: an update on a few concepts
Loan centralization – also called credit centralization, is aimed first and foremost at debtors facing a situation of over-indebtedness or late payments. Indeed, it can happen that you are faced with several credits in progress, and therefore several monthly payments to be paid to different interlocutors. Consequently, the management of your savings tends to become more complex. The centralization of credits makes it possible to overcome this difficulty because it allows the regrouping of all the credits in progress in only one. This type of loan can take many forms depending on the debtor’s situation, from mortgage credit to simple personal loan. The credit consolidation thus not only allows us to better manage a budget but to realize real savings.
What are the advantages of credit centralization?
The first advantage in the consolidation of loans is to no longer have available a single point of contact, with a single premium. So you no longer have to worry about the various remaining monthly payments! In addition, you realize significant savings in terms of costs, and you reduce the amount of your monthly payments. As an over-indebted borrower, you learn how to better manage your assets. The centralization of loans offers many other advantages, such as having an advantageous interest rate.
What are the disadvantages of consolidating credits?
Although the interest rate is advantageous in the situation of consolidation of loans, this is usually done in favor of an extension of the term of the loan or repayment. The borrower in a situation of over-indebtedness will therefore possibly be forced to abandon any future project for lack of sufficient financing. In addition, by subscribing to a new credit organization to centralize all current loans, new mandatory application fees apply. It may therefore seem important to compare the different organizations with each other, by means of a loan simulation, in order to obtain the best possible rate. In short, if you want to reduce your monthly payments with loan centralization and consolidate all of your credits (mortgage, personal loan, credit cards).