There is no relief like being free from the burden of any debt. If you have been struggling with a debt for long and a debt consolidation provides you relief by chalking out an affordable repayment plan there is nothing like it. Owing money can be really stressful if it is a very big amount. So, debt consolidation has its own advantages as a stress reliever. It will help you plan out your payments and also negotiate with your lender to restructure your loan.

Benefits of debt consolidation

• Lowered interest rates:In a debt consolidation program the consolidator negotiates with the lending company to reduce the rate of interest that the company is currently charging you (debtor) so that you can pay off the debt in a comfortable manner. This way more money can be applied towards the principal instead of towards the interest every month. You can also shift your loan from adjustable to fixed rate.

• A consolidated monthly payment: You will no more have to pay bills separately. Your consolidation program will combine all of the accounts in to one monthly payment. The money will then be disbursed to all creditors by the consolidation company.

• Extending due date: Usually you have a due date within which you need to make your payments. If you cross over the due date, creditors usually demand full payment of all the past dues. But by extending the due date you can take some more time to make your payments without having to pay any late fees.

• Creditor acceptance: If you are opting for debt consolidation you stand a chance to get future loans approved sooner than imagined. Lenders will know that you have gone in for debt consolidation and hence will be able to see your interest in paying back the loan.

• No extra charge: Debt consolidation has no extra charge. There is no such thing as processing or application fee. Some consolidators charge so much extra that the benefits become null automatically.

• Grace period: This is given by lenders to creditors to make them feel comfortable throughout the repayment period. This grace period is used by borrowers to strengthen their financial condition. In the grace period you no debtor is required to pay any money to the lender.

Debt consolidation is a great idea that gives financial relief to debtors. This program is ideally suited for people who need money urgently. A debt pay off calculator can be an added advantage. It will help you calculate the monthly installment to be paid within a time frame, assess your current financial condition and more.