Refinancing & Debt Consolidation in Montreal to Pay Your Debts
May 11, 2019
Consolidate your debts, what does it mean? What does it involve? What about mortgage refinancing, the consumer proposal? And what are the advantages and disadvantages of declaring bankruptcy? These are questions that you certainly ask yourself if you are in a situation of overindebtedness.
If question marks appear in your eyes just by reading these lines, maybe you should learn more about the different ways to turn your finances around! Over-indebtedness can quickly lead to a stressful and out-of-control lifestyle and that’s why the Billy Bunter.ca platform strives to find qualified professionals who can guide you through the various stages of the journey. financial apparatus.
In the meantime, here are the different options available to you to end the financial bleeding that you live! What better than a comparison of advantages/disadvantages to put you in suspense is not it?
Consolidate debts, is this the option for me?
Do you have high interest rate debts that accumulate? Get syncope when you open accounts for your 2nd credit card each month? Are you in your first financial difficulties? Are you starting to see the portrait we are trying to draw now?
If you are inclined to answer yes to any or all of these questions, rejoice because debt consolidation might prove to be the pond in your debt wilderness! Consolidation is simply borrowing from a bank to use these funds to settle existing high-interest debt. This amount is refunded on a monthly basis and ensures a full and proper payment each time.
But what are the advantages of consolidating your debts?
-Simplified financial management: instead of scrambling to repay the countless creditors who run after you, consolidation consolidates your payments into one payment each month! It alleviates a burden already present and felt!
– A health credit file: No more late payments! The consolidation loan allows you to make your payments on time each less, which avoids damaging your credit rating!
– Accelerated repayment: The payment plan established upon the granting of the consolidation loan is generally established in such a way as to pay the repayment and to avoid extending the long-term debt. This is, of course, conditional on compliance with the terms of the agreement and your ability to stay out of debt.
Interest rates: Interest rates are greatly beneficial! The number one advantage of debt consolidation is that the loan has a lower interest rate than your current credit.
Life can not be so rosy though, is it? It is obvious that this approach involves some inconvenience. What are the disadvantages of consolidation?
-You must be eligible: The bank will decide whether you are trustworthy enough to receive such a loan. The bank often fears that with the agreement of a consolidation, the bad habits of expenditure do not return galloping. This scenario would be as disadvantageous for you as for the bank, hence their reluctance. That’s why the banks decide, according to their own criteria, who is worthy of receiving such a loan according to your previous credit.
-Your debts must have a high interest rate: It is important that you make sure that the interest rate of the consolidation is lower than that of your current debts. Failure to do so would remove any benefit to the process. That’s why the game is worth it especially for credit or personal loans.
-You might need an endorser: The bank protects its own backs first! If your credit history suffers from a few mistakes, it is even more likely that an endorser will be asked. This avenue should be avoided at all costs, as the banks do not hesitate to exercise their rights with respect to endorsers when the creditor ceases to pay.
We warned you that no miracle solution exists and they all contain their inconvenience. However, you will soon notice that debt consolidation has serious advantages that make this option very viable for a large part of debt cases.
Is the mortgage refinance game worth the effort?
Homeowners or home mortgage holders often have an undeniable advantage when paying down their debts, as the value of this property can be used to obtain additional funds.
But what exactly is mortgage refinancing? This one can take many forms and here are some of them:
– Mortgage line of credit: This option involves borrowing the equity in your home or property to access funds. This amount can be used to settle debts as well as to complete the purchase of another property! This option has many advantages if your home value has increased and the mortgage attached to it is already partially refunded.
-Mortgage cancellation: In the event that your current mortgage no longer suits your needs, it may be interesting to renegotiate the terms with the bank. A successful mortgage renegotiation will inevitably lead to the termination of the old one. This can be interesting if interest rates in the market have fallen. Be aware however that such an approach can be expensive and entail several expenses. That is why it is more than recommended to retain qualified services before diving headlong into a mortgage termination.
– Reverse Mortgage: This avenue is to take out a loan secured by the value of your property. The advantage of the reverse mortgage is that we are not obligated to make monthly payments to repay a fixed amount. You are only required to repay when you sell your home or at the time of your death. However, as you avoid payments, interest begins to accrue.
Refinancing your mortgage should not be taken lightly! Such an important decision is discussed with professionals we will be happy to find for you!
Am I going to make a consumer proposal?
Here we are at a more serious step in financial recovery. Indeed, the consumer proposal is often the buoy that will save you from going bankrupt. But what does it eat in winter exactly a consumer proposal?
This method involves offering your creditors only a portion of the debt they owe under the threat of imminent personal bankruptcy on your part.
-No seizure : You will remain in possession of all your property and none of them will be seized to pay your creditors.
-Credit file : Unlike bankruptcy, the consumer proposal does not lower your credit rating to the lowest threshold. Although it affects your credit report, the impacts will not be felt as long!
-Reduction of debts: If your creditors vote in favor of the acceptance of your offer, they will give up the part of your debt excluded from the bid submitted. So this is a financial concern that goes up in smoke!
-The suspension of the recourses: When your proposal is accepted, the recourses and legal proceedings undertaken against you are suspended and you will be put under the protection of the provisions of the Bankruptcy and Insolvency Act
-The credit file: We are aware that this item is listed under both qualifiers. The reason is that everything is relative! For those who have a bad credit record, the consumer proposal will benefit their record while those with less serious financial problems could find the consequences more serious.
So, if the bankruptcy follows you a little too closely in the rearview mirror and you want to avoid at all costs such an option, talk to a financial advisor or a trustee in insolvency the possibility of submitting such a proposal!
Find a professional in Montreal without delay!
Every situation is unique! Yours is just as important and it deserves a personalized follow-up that identifies the real needs of you and your family. Thousands of financial advisors in the greater Montreal area specialize in debt settlement and could save you incredible amounts of money in addition to getting you out of debt.
Such an approach is essential to help you make the best decisions to restore your financial situation.