Information on consolidating your dept
Make sure to get a full and complete list of all fees before deciding on a loan.
Being able to compare the APR between your current loan products and the debt consolidation product that you’re considering will help you make a wise decision.
If you take out a new form of credit to consolidate your debt, for example a credit card that’s interest-free for a year, and immediately close all other forms of credit it could actually hurt your credit score.
A component of your credit score is the ratio between your open lines of credit and the amount of capital you’ve borrowed.
If you’re unsure if existing debtors will charge you a prepayment penalty call and ask before arranging to pay off the loan early.
If one exists, it could wipe out any cost savings from consolidating your debt. When putting together a business plan you might have planned for a debt consolidation and then to take out another loan for a business expansion.
Banks look at your leverage when deciding whether or not to lend, and it also impacts your credit score.
Leverage is the amount of your business that is financed by debt.
Variable or Fixed Interest Rate One of the reasons that many small business owners look into debt consolidation is to convert variable rate debt into fixed rate debt.If you’re a small business owner struggling to make payments on credit cards and loans you might have been wondering if consolidating your debt would be a good idea.Debt consolidation companies often target those with high balances, sending letters and calling with promises to lower your monthly payments and save you money.But do these companies really do what they promise, and can they help your business?Here’s everything you should know before applying to take out a debt consolidation loan. During the start-up or growth stages of a small business many small business owners take on debt.