Recently, I have been involved in numerous finance deals for debt consolidation and re-financing of existing loans. Whilst lenders express an “appetite” for new loans, Debt Consolidation Loans are also on the increase .
Here are some salient points to note when seeking a Debt Consolidation Loan :-
- If credit cards are included in the loan, most lenders would only accept up to 4 credit cards. Non-major specialist lenders however, would accept up to 6.
- What are the savings for the applicant should a Debt Consolidation Loan be approved, and will the savings be applied to the new loan?
When seeking to refinance existing facilities, including consumer debts (i.e. credit cards, personal loans and store cards), lenders would require as a minimum the following :-
- 3 months record of credit card(s) / store card statements
- 6 months record of existing loan statements
- ATO portals access (if self employed)
- 6 months record of daily transactional accounts, showing salary credits and financial activities etc
With older borrowers, lenders again will look at a clear ‘Exit Strategy’ to ensure that the loan will be cleared within the retirement age frame, and not cause any hardship to the borrower. In most cases, a new loan would be placed onto a Principal and Interest repayment to consolidate the debts.
Tags: debt consolidation