We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Nobody downloaded yet

Debt Consolidation - Essay Example

Comments (0) Cite this document
Summary to essay on topic "Debt Consolidation"
Debt consolidation is a process that involves taking of a loan to settle many other loans. The primary reason for doing this is to acquire a single loan with a lower interest rate which is normally at a fixed rate, instead of paying higher interest payments to a number of lenders…
Download full paper
Polish This Essay
Debt Consolidation
Read TextPreview

Extract of essay "Debt Consolidation"

Download file "Debt Consolidation" to see previous pages... An agreement on collateral against the loan gives a lower interest rate for the loan, as the risk factor decreases. Naturally, if there's no collateral against the loan, lenders don't have any form of security for their money and they resort to charging a higher interest rate. So if the true purpose of debt consolidation must be achieved,
Let us write or edit the essay on your topic "Debt Consolidation" with a personal 20% discount.. Try it now
it is advisable to keep an asset as collateral so the lenders can make a forced sale on non-payment of the loan and so that the borrower can receive the low interest rate he's looking for.
This method has been proven successful when dealing with credit card debt, as credit cards often carry a much larger interest rate than even unsecured loans. In an interview, Kerri Cole talked about her practical experience in dealing with her debt problem. She went to Credit Consolidation Services and got her interest payments reduced on all 9 credit cards she owned; one of the card's interest rate fell from 27% to 9%. For a small monthly fee, she is saving over $600 a month since she started debt consolidation which makes a rough figure of $7200 saved each year. Though some companies tend to take advantage of these situations and indulge in predatory lending, the particular company Kerri talks about has been refreshingly fair and accommodating to her problem. Predatory lending is a term used for lenders who use deceptive methods to convince borrowers to agree to harsh and unfair loan terms, or the systematic violation of the terms by the lenders in such a way that it is very hard for the borrower to defend against it ('Predatory lending,' par.2).
In recent reports, media has raised concerns over debt consolidation. They have pointed out that a large majority looks to reduce their interest rate by converting their unsecured loans into a secured loan. The problem arises at their choice of asset to secure the loan against. Most people tend to secure their loans against their home ('Debt consolidation,' par.13) which is a dangerous practice; putting at risk such a valuable asset would certainly not be the most advisable thing to do. The monthly payment does get lower, but the actual amount repaid over the years is often significantly greater in proportion due to the long period of loan. What people argue is that debt consolidation mostly cures the symptoms of the problem and doesn't hit at the root cause of the disease.
To owe someone money is always very stressful. The stress is compounded when you owe money to not one, but quite a few lenders. Debt consolidation can provide means to develop a workable budget, and it would greatly reduce the stress level by bringing the number of lenders down to one. This would also be beneficial in the sense that one is less likely to forget a due payment of a single lender than attending to a large number of lenders, each with their own separate terms. Often it happens that because of a non-payment, you get further fines and charges on late payment; a debt of $500 could rise to $700 just because of an imposed fine. Debt consolidation will lessen that amount back to the principle amount (Selman, par.3). So, through debt consolidation we are looking at numerous advantages like no fines or monetary charges, reduced number of lenders, a lower interest rate and no warning calls. Also with your credit rating improving because of debt consolidation, if you are looking for a new ...Download file "Debt Consolidation" to see next pagesRead More
Cite this document "Debt Consolidation"
  • APA
  • MLA
(“Debt Consolidation Essay Example | Topics and Well Written Essays - 1000 words”, n.d.)
Debt Consolidation Essay Example | Topics and Well Written Essays - 1000 words. Retrieved from https://studentshare.org/miscellaneous/1513288-debt-consolidation
(Debt Consolidation Essay Example | Topics and Well Written Essays - 1000 Words)
Debt Consolidation Essay Example | Topics and Well Written Essays - 1000 Words. https://studentshare.org/miscellaneous/1513288-debt-consolidation.
“Debt Consolidation Essay Example | Topics and Well Written Essays - 1000 Words”, n.d. https://studentshare.org/miscellaneous/1513288-debt-consolidation.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document
Government Debt: Should we be unduly alarmed
A similar view is the theory of Ricardian equivalence. The theory of Ricardian equivalence argues that financing debts through bonds is merely deferred taxation and is basically similar to current taxation (Dornbusch et al. 2011, pp. 336-337). Thus, because debts are merely taxation postponed, they have no effect on the economy (Miles and Scott 2005, p.
6 Pages(1500 words)Essay
Government Debt
29). Government debt can be classified into two categories namely the internal and the external (Chamberlin and Yueh 2006, p.86). Internal debt refer to the amount of funds collected within the country from local investors and government run institutions such as pension trust fund.
6 Pages(1500 words)Essay
Government Debt
This debt is outstanding and financed through borrowing (Wells & Krugman, 2009). These finances are necessary in funding government operations and implementing monetary policies that solve the populace’s problems and cushion them against recessive economies (Pentecost, 2010).
6 Pages(1500 words)Essay
Bankruptcy Law
She has accrued about $75,000 in debt and is unable to pay her creditors. She has decided to file for bankruptcy so she can settle up with his creditors and move on to another, hopefully more profitable, business. Chapter 7, 11, and 13 are specific types of bankruptcy that can be declared by an individual or a business.
2 Pages(500 words)Essay
Credit card debt in the Uk today
The demand for customer side has also given rise to the number of institutions providing these services. This has made the industry more competitive. In United Kingdom the demand for financial products has increased with the increase in net disposable income.
5 Pages(1250 words)Essay
Media Consolidation
The rise of the digital age has changed how everyone makes a living in this industry so there is a lot of shuffling around trying to find a method of agreement. Recording artists income have increased in the live performance arena so the recording companies are searching for a way to keep up.
6 Pages(1500 words)Essay
Argentinas Foreign Debt Restructuring
The author provides a meaningful financial analysis of the restructuring of the foreign debt by Argentina. Argentina bogged down by its mounting external debts decided to settle all the foreign currency public debt by replacing the debts with new securities calculating at the rate of 35 cents per every dollar of debt.
18 Pages(4500 words)Essay
In other words, fiscal deficit will put each citizen of a country indebted to some external financial sources. Thus even the new born babies are indebted to somebody even from the beginning of their life on earth. It is essential for a government to
2 Pages(500 words)Essay
Regarding Consolidation
For this purpose there is a need to remove such individuals or such measures that are unable to provide the company with adequate success. The authors
1 Pages(250 words)Essay
Debt sustainability and Fiscal Councils
The global financial crisis of 2008 has created unending ripples on the economic health of the nations. The government of different countries have heavily relied on the concept of deficit spending in handling the crisis. This is a system in which the government of countries makes more disbursements to stimulate the economy than its earnings.
10 Pages(2500 words)Essay
Let us find you another Essay on topic Debt Consolidation for FREE!
Contact us:
Contact Us Now
FREE Mobile Apps:
  • About StudentShare
  • Testimonials
  • FAQ
  • Blog
  • Free Essays
  • New Essays
  • Essays
  • The Newest Essay Topics
  • Index samples by all dates
Join us:
Contact Us