Nowadays, since the introduction of the new comprehensive credit reporting regime, potential credit providers can assess your loan application relying upon more detailed information about the way your manage your finances and your repayment history for the past 24 months.
This means that if you have a number of debts and you are finding it difficult to manage all the debt and consequently pay your bills late, this will more than likely affect your credit reputation and your ability to obtain a loan.
If you have a debt problem and you intend to refinance your multiple debts by swapping debt for one, cheaper debt, it's essential that you cancel the old credit facilities otherwise there is a risk that you will come to use those facilities again and ultimately find yourself in twice as much debt than when you started.
One of the biggest mistakes that people make is assuming a consolidation loan will be cheaper.
This is not always the case and interest rates will vary depending on your credit reputation and the lenders assessment of your application.
At Debt Fix, we know everyone's situation is different and we understand that there is no “one size fits all” solution when it comes to managing debt.
For this reason, we present affordable options specifically tailored to suit your situation.
The new laws mean that potential credit providers now have access to more comprehensive information about your level of indebtedness and more specifically, the way you manage your debt.
Until now, credit providers could only see your personal details, credit infringement information and the amount of times you may have applied for credit (assuming that the credit provider made an enquiry).
A Direct Consolidation Loan allows the borrower to make a single monthly payment. A Direct Consolidation Loan allows borrowers to lower the number of loan payments they have to make each month, combining them into a single payment.
Most federal loans are eligible for consolidation, but private loans are not eligible.
Once the loans are rolled into a new loan, those benefits are lost.
Additionally, if the new loan increases the repayment period, the borrower may wind up paying more interest.
Borrowers can consolidate once they complete school, leave school or fall below half-time student status.