How Loan Refinance Amalgamates Debts into 1 Easy Payment!

Adam Brand Adam Brand | Operations Director

There is nothing worse for your personal finances than to find you have multiple loans with combined interest rates that are killing your monthly budget. Fortunately, you do have loan refinance options that will allow you to amalgamate all of your high interest loans into a single, affordable low rate monthly payment. You can do this by refinancing with a secured loan.

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The right loan refinancing package could provide you with enough money to pay off all of your existing debts and, perhaps even have extra money to spend on other things. You could pay off credit cards, satisfy high interest personal loans, pay for medical expenses, and so on. The fact is that refinancing is a very powerful tool that you can use to improve your financial circumstances.

Refinancing Defined

We do not want to confuse refinancing by way of a secured loan with taking a second mortgage or refinancing an existing mortgage. All three products are very different in nature. When you are talking about second mortgages or mortgage refinancing, you are dealing only with your monthly housing payment. Also, remember that second mortgages result in multiple monthly payments.

When you refinance existing debt with a secured loan, you are obtaining new financing by using property as collateral. The idea of combining multiple debts into a single payment is one that takes advantage of the equity in your property. What is equity? It is the difference between what you still owe on your mortgage and current property values.

Let's say you owe £50,000 on a home that is worth £100,000. You have £50,000 in equity. Obtaining a secured loan provides up to £50,000 you can use to pay off the other kinds of debts we already talked about. You would end up with just a single loan and monthly payment.

Saving Money

Among the many reasons people choose a secured loan refinance package, the most common is a desire to save money. This is easy to understand if you just look at the different interest rates you are paying for all of your loans. You might be paying 9% on your credit card and 5% on each of two secured loans. If you could combine all three into a refinancing package at 3%, you would be saving a substantial amount of money over the long term.

Consolidating multiple debs into a single loan will likely reduce your monthly payment as well. You could potentially save hundreds of pounds per month by employing this strategy. Saving on your monthly loan payments puts money back in your pocket that you can spend on other things.

Know Your Limits

The key to making the most of home refinancing is to know your limits. What do we mean by this? You need to understand what your monthly budget allows and how your current credit history will affect your borrowing. It may seem as though refinancing would be better for the budget, but poor credit may actually make it more costly for you to borrow. These are things you need to know before you apply for refinancing.

Our advice to you is that you sit down and go through your finances in detail. Figure out what is going on before trying to work out a way to improve your financial position. Simply put, you cannot fix what is broken until you know what parts need to be fixed. If credit blemishes have occurred since you first obtained those other debts, you may want to work on repairing your credit before you try to refinance.

A loan refinance package from a reputable lender could make it possible for you to consolidate all of your high interest debts into a single loan that is a lot easier to manage. Secured Loan Expert encourages you to do the maths. Refinancing could be one of the wisest financial decisions you will ever make.

If you need any help with refinancing our team of friendly expert secured loan advisers can help. There is no charge for their professional advice and with the technology at their fingertips they can source the most suitable offers to suit your individual criteria from a whole of market panel of the top UK lenders in a few minutes.

Our expert team will help you compare the deals on offer side by side and make you aware of all the costs of each loan so there are no hidden surprises later in the process. When you are happy with a particular deal they will craft an optimised application ensuring that your case in reviewed by the lender in the best possible light and submit the application on your behalf.

Our team work for you and not the lender and their only interest is in finding the best deal for you.

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