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If you have several debts, using a personal loan to consolidate what you owe into one manageable monthly payment could be a convenient way to reduce the amount of interest you’re paying and help clear your debt faster. We take a closer look to help you assess whether it’s the right choice for you. How to consolidate debt with a personal loan? Combining multiple types of debt – such as credit card and store card balances, loans, overdrafts, and payday loans – into a single monthly payment can make it easier to manage your finances and potentially save you a decent sum of money too. One way to do this is to use a personal loan. The amount borrowed through the loan can be used to pay off your existing debts, and you’ll then repay your new lender in monthly instalments, ideally at a lower rate of interest. This means you’ll only have one payment to make each month, rather than several, and only one lender to deal with. What are personal loans? Personal loans typically l...

While refinancing has been rising recently, Loan Market’s executive chairman has highlighted how brokers have been helping clients reprice their mortgages with existing lenders. Loan Market executive chairman Sam White has underlined the importance of brokers maintaining an ongoing relationship with their clients that stretches beyond the home loan transaction, including by negotiating for better rates on their existing loans. Addressing property investors and landlords at a webinar hosted by Loan Market and Ray White last week, Mr White observed that Loan Market has been seeing more enquiries from clients around repricing their loans. Mr White highlighted how brokers have been working with customers beyond the initial home loan transaction, offering ongoing service, even when it is not income generating. “It’s not just about getting a deal done. It’s been about helping the existing customers that we have,” Mr White said. “In fact, for one of our brokers who won an awar...

The very thing that makes personal loans appealing — that they can be used to pay for almost anything — is also what makes them difficult to navigate. Unsecured personal loans can pay for almost anything. Their flexibility makes them easy to turn to when you want to consolidate your debts or put in that kitchen island. But first assessing all your financing options can save you money. As the economy shifts, so will the way a personal loan fits into your plans. Right now, for example, the cheapest way to get extra cash might not be with a personal loan, but with 401(k) funds. The government is allowing penalty-free withdrawals from these savings for those affected by COVID-19. Still, withdrawing money from your 401(k) could mean you lose out on potential market gains and set your retirement plan back. Even if an unsecured loan isn’t the cheapest, it may be the next-best option. Here’s what financial planners said about some of the reasons people take out personal loans. ...

Whether it’s due to having no credit or bad credit, a day may come when a family member or friend asks you to cosign a loan. Before you answer, you need to give the situation a lot of thought. By cosigning a loan, you’re legally responsible if the other person doesn’t pay or if they die. The situation could hurt your credit score as well as your chances of getting a line of credit in the future. According to the Federal Trade Commission, 75 percent of cosigners end up repaying some or all of a loan when the primary borrower defaults. If you’ve already cosigned a loan, there are steps you can take to remove your name from the debt and limit your liability. Request a cosigner release In some cases, such as if you signed a private student loan with your child, lenders will allow you to file paperwork to remove a cosigner’s name from a loan. The primary borrower will need to have demonstrated responsibility for the loan, such as making regular, on-time payments and having a goo...

These are the 5 worst ways to pay student loans during COVID-19. Here’s what you need to know – and what to do about it. Student Loans Many borrowers are asking “Should you pay off student loans during COVID-19?” Your strategy for student loan repayment can have a major impact on how much you spend on your student loans. That’s especially true during the COVID-19 pandemic, which has caused approximately 30 million people to file for unemployment benefits. Whatever you do, make sure to avoid the 5 worst ways to pay off student loans: 1. You don’t recertify your income If you’re enrolled in an income-driven repayment plan such as Income-Based Repayment (IBR) or Revised Pay As You Earn (REPAYE), you can lower your monthly payment to as low as $0 per month. After 20 or 25 years of monthly payments, you can receive federal student loan forgiveness. Yes, there’s a catch. You will owe income tax on the amount of student loan forgiveness you receive. If you recently lost your j...