From the list of solutions to the excess of indebtedness comes the consolidated credit without mortgage, a financial solution potentially interesting for those who want to reduce their installments with credits. Here’s what the potentialities and dangers of consolidated mortgage-free loans are
Add the Credits All in One
The consolidated credit consists of joining all the credits together. In this context:
- With Mortgage – Giving a property as collateral can lengthen the deadlines and have an interest rate similar to the rates applied in mortgage credit;
- No Mortgage – Consolidated credit without mortgage is also known only as consolidated credit. In this case there is no guarantee of a property so the term and interest rates are not as attractive as if you had this mortgage.
Is Mortgage Without Mortgage Good For You?
The solution presented may be a good solution for you. But it can also be something negative. Everything will depend on your use of this credit consolidation. As main advantages, we can highlight:
- Reduce benefits – You can greatly reduce your credit installments, especially if you have many short-term credits (such as credit cards). In some cases, consolidated credit without mortgage reduces benefits by more than 60% ;
- Improved management of benefits – It has only one benefit, which can manage more easily, resulting in fewer delays and defaults (and consequently fewer commissions and interest on arrears);
- Reduction of the average interest rate.
What are the Disadvantages of Consolidated Credit Without Mortgage?
As in everything in life, there is a reverse of the medal. Not everything is roses. But if you make a good use of this tool you will be able to take advantage of the advantages and avoid the disadvantages, which are:
- Incentive to consumption – If you do not have discipline, reducing benefits will mean you will have a lot more income to spend. In this way, it can happen that it returns to consumption and that even more indebted;
- Payment of More Interest – In some cases, the lengthening of the deadlines may imply in the increase of the total amount of interest borne throughout the credit.
How to Avoid Paying More Interest With Your Credit Consolidation?
If you have made a consolidated loan without mortgage know you can cut the total amount of interest paid. This is possible because:
- The average interest rate can be reduced – If you reduce the cost of money, you may pay less over all the years;
- Early Amortization of Credits – You can use the savings generated with the consolidation of credits to amortize your consolidated credit in advance. You are not obliged to do so. You have this flexibility and freedom. But if you do, you’ll end your credits more quickly.
How to Have the Best Consolidated Credit Without Mortgage
To find the best consolidated credit in the market we suggest that you fill out the credit simulator below. By filling out the simulator you will be able to find the best credit in the market because Michael Henchard contacts several banks and financial institutions, choosing the cheapest one for your specific case. And all without any cost of analysis and dossier for which, once again, maintains all freedom.