About Loans

Just like there are different types of credit card debt (secured and unsecured) there are also different types of loans. Most loans also fall under the category of secured and unsecured, however, the means in which they may be obtained are far more diverse and wide ranging, including but not limited to home equity loans, 401k loans, pay day loans, pawn loans, and more.

Debt Consolidation Loan

For years this has been a very popular option for many individuals looking for a way to pay off credit cards and other debts. The ability to consolidate all of the bills into one monthly bill seems like a great idea at first, however, many of these loans take the equity or “cash” out of your most prized asset (your home) to pay off your credit cards. As a consequence, you have turned an unsecured debt into a secured debt, and have likely increased your overall debt amount because of higher adjustable rates, closing costs, fees, and points associated with these loans.

The payments on such loans can quickly skyrocket and become unaffordable and jeopardize your ownership of your home. During this period you may be forced to start using credit cards again to be able to afford the necessities, leading you back to the exact problem that you tried resolving in the first place, except that you are now in an even worse situation.

While these loans may work for some under the right conditions, they aren’t for everybody. If you are considering a consolidation loan or a home equity loan but don’t want to fall into the trap of getting further in debt or jeopardizing your home, CALL FINANCIRA TODAY at
1-866-987-3328.