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Availing a Debt Consolidation Loan is a Breeze – You Need to Know the Right Ways!

Business Isabella 30 May 2018

Having you been really worried because you have accumulated a lot of debts? Well, you have to understand that although it is a cause of concern to accumulate debts, you are not the only one as there are a lot of people all over the world who are trying to find ways for reducing their debts. With the proper planning as well as the right actions, you can find that debt consolidation is the most efficient way for handling mounting debts.

With debt consolidation, you can combine multiple small unsecured debts into a single debt. For instance, your credit card’s payment, loan repayments, medical expenses and such can all get collated to form a single payment. It will help you to make life simpler for you, and you can manage your financial compulsions with ease. This article will tell you how you can apply for debt consolidation loans.

Debt consolidation loans are especially viable for people who have just retired. Retirement can bring a lot of financial difficulties. People will not be ready to give you loans and the insurance schemes available for you will be too costly. As you will not be earning as much as you had before retiring, you will be in a spot of bother if any financial mishap were to happen. Thus, it is necessary that you should start to prepare for early retirements so as to get covered for all probable situations in all possible ways.

Questions To Ask While Choosing A Debt Consolidation Loan

You must try to become debt free by the age of 50 years and hence, try going for debt consolidation by the time you are 45 years of age when all your debt accounts will get closed except for one. You have to target settling this one account by the time you are 50 in the next 3 to 5 years. Also, because your easy monthly instalments or EMIs will be reduced significantly, you will be able to use this money for investments as well as savings as your requirements and choices demand.

Eligibility criteria for Debt Consolidation Loans:

In this part of the article, we shall be providing you with some basic criteria for eligibility which has to be met for availing debt consolidation loans.

  1. The age of the applicant for debt consolidation must be between 21 years to up to 60 years of age.

  2. In the event that an applicant is a salaried person, then the minimum income he must have will be fixed at some basic level. The bracket of the salary will, of course, be dependent on the city the applicant lives in. For instance, in case a person is living in a metropolitan city then his salary bracket should on the higher side when compared to a person working in a non-metro city. Similarly, if a person is working in a top-ranked multinational company, then his salary bracket will, of course, be lower than someone who is working a new start-up enterprise.

  3. Any applicant for the debt consolidation loan must have been staying in that city for a minimum of one year.

  4. An applicant also has to have a minimum of work experience for two years.

  5. The applicant will be required to have all his documents in proper order like his address proof, salary slips, identity proofs, bank statements, etc.

Process for applying for a Debt Consolidation Loan:

You will have to go through a series of quite easy steps in order to be able to get a debt consolidation loan. The processes will be explained here. You can find additionally all the information which potential debt consolidation loan companies have provided on their websites also. As a borrower, you must go through the sites and see what plan suits you best. You must also be conducting a proper cost against benefit analysis in order to see the best deal available out there for you.

When you have decided on which deal you want to choose, you will find the specific steps for that deal available on the company’s website. You will have to initially fill up a form which is available on the site of the lender. The form will be consisting of some basic information like the age of the borrower, address, his income details, working experience, etc. You will then have to provide copies of all your documents like your identity proof, address proof, company offer letter, salary slip, etc.

The approval of your loan is dependent on a lot of different criteria like your credit score, your financial history, your income details, your loans as well as your rates of interests previously incurred. You will be able to check your credit score and your eligibility chances online before applying. If you find yourself falling under the parameters of the eligibility criteria, then the chances of your loan getting rejected will decrease a lot. Always ensure that your credit score is good when you are applying for a loan because this is the most crucial factor that can get your loan approved.

After your loan has been approved, the bank’s department will make further contacts with you. You will get the credit for your loan amount directly placed in your bank account.

In order to ensure that you do not accumulate any debt in the first place, it is essential that you reduce your expenses and start managing your finances properly from an early age. This will help you live off your income in the future.

Wrapping things up:

Debt consolidation loans are to help manage their financial problems with acuity. The process might seem cumbersome and overwhelming to people, but in reality, it is quite simple with certain basic parameters and criteria for eligibility. Always try to maintain good credit scores in order to get your loan application approved. And once it is approved, try to make your monthly payments on time. Thus, you can become debt free with ease.



Isabella Rossellini is a marketing and communication expert. She also serves as a content developer with many years of experience. She has previously covered an extensive range of topics in her posts, including business debt consolidation and start-ups.