April 25, 2020
by Addison Davies
Managing one’s finances is not a game of luck. Nor is the fact that many people state that hard work can lead to good earnings.
We all know that everyone is working hard and struggling to earn and meet all their needs. All-day for about nine hours a person does office work and toils hard to feed himself/herself and lead a balanced life.
Monthly earnings from one job or even multiple jobs, profits from business, or also rent income, all contribute towards all expenditures made.
However, so many times then circumstances so happen that some financial emergency might happen to anyone. It might be unforeseen and gets one off guard.
It might be an increased tuition fee of one’s kids, hike in rental payments of the house, a medical emergency of one’s mother, or even losing a job due to accident.
Factors may be many, reasons multiple for a cash crisis, and one’s income doesn’t need to be able to fulfil all these demands. Therefore, at such crucial times, many people resort to taking the help of loans.
Moreover, the cash flow crunch is not at all a new thing, and with most people stuck at home during this time of COVID – 19 pandemic, it’s even more apparent.
People who earn on a daily, monthly and even fortnightly basis have the lack of funds. Their livelihood has come to an abrupt standstill.
Loans of short term nature for various needs cater to the immediate requirements of all these people to fill any monetary gap. A respite for the near term, many people would have taken different kinds of credits not only in the form of loans but also in credit cards.
Perilous is the scheme of interest payments of credit cards as the amounts keep on getting increased exponentially at a spiralling rate.
NEED FOR DEBT CONSOLIDATION
People out of the mismanagement of their finances take various kinds of loans along with even more than one credit card. Such loans might be for housing, vehicle, holiday, or even any other personal use.
Then comes the time when the servicing for all these debts becomes pending and gets bombarded all at one time. A crisis occurs, as banks and other institutions are chasing people for timely repayment of all these debts.
Different amounts of principal payments, along with varying interest rates, become very difficult to pay with just one source of income for people. In addition, for tackling this behemoth problem, a well-charted debt consolidation plan should be there nicely.
Debt consolidation is a process of calculating the whole amount of debt owed to the creditors and other people and formulating a realistic and viable plan for all their repayments.
THE PROCESS OF DEBT CONSOLIDATION
For consolidating one’s debt, you can approach many banks, but they all should have the license granted by the FCA – Financial Conduct Authority of the United Kingdom.
After comparing the interest rate, total debt, the repayment term, an agreement is entered into with the creditors for a good settlement.
In addition, sometimes for this, a debt consolidation company can use this.
This company ensures that it pays off all your debt payments to different creditors while one only will have to take care of instalments as calculated.
Moreover, for all these processes, one must be wary and beware about origination fee/early payment fee, late payment fee, and other charges.
Some banks and online lenders may either charge or not charge these fees, depending on case to case basis.
In addition, the prospect of making a payment early is not feasible for banks as that amount is devoid of the interest amounts that they can earn if not the early payments made.
Thus for early payments as well some banks charge fees, beware of this.
COST OF CONSOLIDATION
Additionally, there is also a price to be paid for the whole consolidation process in the form of a setup fee and handling fee.
A setup fee is there for one time only, but the handling fee is loaded every time a payment is made.
Debt consolidation loans in Ireland by online lenders is the best way of taking care of one’s debt in the most wholesome manner.
Rate of interest lowered to a very affordable amount coupled with affordable instalment amounts; these online lenders are genuinely a blessing for people marred by debt problems.
These online lenders assist in completing the systematic payments of all debt into one monthly/quarterly amount, and this too within considerably less period in contrast to the earlier debt liabilities.
Some people can also avail quick loans in Ireland for immediate relief from any cash flow crunch.
Online lenders, after certain formalities, credit the entire loan amount right into the bank account of the borrower within the very same day or a few hours. Such fast loans are very useful in filling any temporary financial emergency.