How can Debt Consolidation save me money?

Debt consolidation by design is a powerful way of reducing the number of repayments you make monthly, also lenders will generally offer a lower interest rate to your outstanding debts. A consolidated debt can be very helpful at simplifiing your repayment plan, replacing the need to make numerous high interest repayment. With a consolidated debt loan you only have the one low interest to pay monthly, making financial management easy and affective towards saving.

Debt Consolidation Example:

Type Of Loan

Remaining To Pay

Interest Rate

Monthly Repayments
Mortgage           $150,000       6.9%      $1,051
Car Loan            $20,000        9.0%       $415
Credit Card         1 $9,000      16.5%     $240
Store Card          $6,000         14.0%     $200
Personal Loan 1  $19,000       12.5%     $427
Personal Loan 2  $15,000       14.0%     $349
 

Total:
$219,000 --- $2,682

By consolidating his debts, Peter’s monthly payments are reduced from $2,682 per month to $1,049 per month. He is saving $1,633 each month.

 

Type Of Loan

Remaining To Pay

Interest Rate

Monthly Repayments

Mortgage $219,000  7.6%  $1,633

Savings per month

$219,000 --- $1,633 see what looks like