Debt consolidation is the secret that the rich continue to improve their finances and not pay too much interest. How many times has it happened to you that the last days of the fortnight arrive and you need 200 or 300 pesos? It’s strange, because at the beginning of the month you made accounts and covered all the expenses and even had a few pesos left over.
This happens because when you make a list of your income and what you are going to spend during the whole fortnight or month, you do not usually consider the small unforeseen events of the day, which at the end of the week add up to an amount that was not considered in the budget.
Maybe yesterday your son had to buy material for school and today your daughter asked you for 20 extra pesos to buy a soft drink at recess time. These small leaks are what unbalance the accounts.
So not to get to red numbers one or two days before “the money falls”, the best thing is a timely monitoring of what you spend daily, as well as your debts.
Doing it is very simple, you just have to make a daily list of your expenses such as transportation, food, balance of debts, housing and other expenses. You must also add what your initial balance is, that is, how much money you left over yesterday and today you have in your bag.
So you can have a better management of your income and you can notice that if today you had an extra piquito, tomorrow or the day before you will have to compensate. With this, you will have a better handle of the finances of the home and you will arrive calmly to the following fortnight.
Now, if you have already done this exercise called “cash flow” and you still do not complete the week, maybe your debts are suffocating you and you need a special strategy to settle them.
How many credit cards do you handle?
It is currently common to handle more than two cards and other personal credits. The first problem is that you should never use a loan to pay another debt.
This only makes the problem more acute.
Yes, you needed those thousand pesos to compare the school supplies to your son. However, it is a temporary solution that the next payment date will only intensify the crisis.
The second major drawback is the payment schedule.
Each card has its cut and payment dates, so it is common to get confused and therefore fall behind. The bad thing is that late fees are huge and complicate the situation even more.
If you are one of the people who juggle payments, taking out one card to pay another and confusing the dates, you probably need to consolidate your debt to finally go afloat. Otherwise you will never get out of that vicious circle
What is the consolidation of debts?
It consists of unifying all the debts into a single one, so instead of having 4, 5 or 6 accounts that are like a puzzle, you are dealing with a single payment.
Can you imagine never paying late interest?
Forget going to the bank more than three times a week, making lines of two hours and receiving calls on Sunday morning to demand a payment.
How does it work?
It is very simple.
In Credifiel we give you the opportunity that if you have credits contracted with another financial institution, come with us so that together we solve it in the best way and obtain better payment terms.
The requirements are very simple, the most important thing is that you work in a government institution that has an agreement with Credifiel, you need to receive your salary through payroll or have a bank card.
The amount of the credit and the term to be paid is appropriate to your profile and your needs. To apply for the credit go to our website, fill out a short form with your information and then our team will contact you.
How does it work? Usually the cards of the other banks are liquidated and frozen in order not to increase the debt and the payment of the only debt can be less than everything you paid as normal.
Do not think that by paying less, the debt decreased; Usually the terms of the debt are extended for a few more months. That is the reason why you pay less.
Let’s give an example so that you understand how debt consolidation works.
Fernanda was a high school teacher, had two children and paid rent. She started with a card with a modest credit. When his two children entered primary school he had to make a heavy expenditure on uniforms and supplies.
It was here when his line of credit was insufficient and he asked for a personal loan. A year passed and he was still paying the credit card and the personal credit, but with the beginning of the school year the money was again insufficient.
It was then when he asked for a second credit card and, to make the situation more complex, he decided to say yes to a departmental card.
Six months went by and the problems began.
He had the money to pay the four credits, the rent and all the snacks of his son, but there were times that he confused the days of payment and he was late, generating commissions that went beyond his budget.
After a period of stress and uncertainty, Fernanda heard about the debt consolidation program and asked at her bank.
They studied your case and accepted your request.
What the bank did was to unify the accounts and pay the departmental store.
Now Fernanda makes a single payment, the monthly amount is less than what she previously paid and she is sure that in 48 months, the debt she never thought she would end was going to come to an end
What you should consider about debt consolidation
You must be clear that debt consolidation is like asking for a new loan, then it is subject to all the variations of rates and commissions that a normal credit has.
The big advantage for you is that you should not break your head in 5 accounts because everything is centralized in only loan. Like all credit if it is not handled in an intelligent way, it can cause more problems than benefits.
Therefore, before asking for a debt consolidation, you must analyze your financial situation and see if you have alternatives to pay.
We recommend that you:
- Review your expenses. You already know what a cash flow is and how to use it; You can put it into practice and detect which are the leaks of your income. If your daily expenses exceed your income, the consolidation of your debts will not be effective as long as you do not reduce expenses.
- Make a budget after modifying your expenses. You already identified which are the expenses that you must reduce or avoid, now you must take account and see if with this restructuring you can pay the debts that you already have.
If you have already analyzed your financial situation and you recognize that your best option is debt consolidation, then you should keep in mind the following points:
- Interest rates can be variable.
- The debt is rediffered from 12 and up to 48 months
- The payment can be biweekly or monthly
The payment can be via payroll or domiciled to a bank account
Debt consolidation can be the best way to end a debt. Rate all the points mentioned above to know if it is the best strategy for you.