Consolidating debt information
When you take out a secured loan, such as a mortgage or a car loan, you pledge certain property, such as your home or your car, to secure the repayment of the loan.For example, when you obtain a mortgage loan, your house is security for repayment.A variety of financing firms will also loan you money against lawsuit claims, lottery winnings, and annuities. Lower interest rates will likely make the monthly payment lower and more affordable.Sometimes, the interest payments are even tax deductible.And, while the interest rate might be higher than a secured loan, it might be less than is charged on several different credit card balances, thereby lowering your interest burden and your payment.
A single monthly payment with a lower interest rate is likely to ease your financial burden substantially.The theory is that one payment will be easier to manage.The goal is to lower the interest rate and the monthly payment while paying off your debt more quickly.A 401K loan uses your retirement fund as collateral.If you have a life insurance policy with cash value, you might be able to obtain a loan against the policy. Often, secured loans carry lower interest rates than unsecured loans so they may save your money on interest payments.