3 Steps to Consolidate Your Debt

  • August 27, 2020
  • Written by : REIL Capital

Business owners leverage debt consolidation loans to stop hurting their cash flow from multiple payments. Below, we will walk you through 3 steps to consolidate your debt even with bad credit. 

Sometimes unnecessary debts from multiple sources can be a curse to your earnings every month. If you are running a business, debts can put a halt on your growth. Fortunately, there is a highly effective way to deal with multiple loans- debt consolidation. This process allows you to streamline all your high-interest debts and convert them into one payment so that you don’t have to pay interest separately. 

Check Credit Score

We understand that a bad credit score will not necessarily disqualify you for all funding options but a good or excellent credit score can get you quick-approval. FICO is the most preferred credit score you can try to check your credit score. A high credit score, usually between 690 to 850, also helps you get a discount on interest rates. 

The new debt consolidation loan usually has a lower interest rate than the combined interest rates on your debts. This will not only reduce the overall debt to be repaid but you will also have different terms. If you don’t qualify for a debt consolidation loan due to credit, spend some time building your credit score. Catch up on late payments, check for credit report errors, and repay any small debts. 

Create a List of Debts

Make a list with all the debts or loans to consolidate. This can include business credit cards, payday loans, or any other high-interest debts. Add the total amount and you will get the total amount you need through the debt consolidation loan. 

Also, add up all the payments you make monthly towards your debts. Now, you need to check your budget and determine a single payment to these loans that can also fit your budget. Your new debt consolidation loan should have a monthly payment around your estimate with a lower interest rate than all the other debts combined. 

Explore Loan Options

You will find several banking and non-banking companies offering a variety of business loans but not all can fit your needs when it comes to debt consolidation. Business Debt Consolidation offering from REIL Capital comes with great terms where you can reduce monthly payments by up to 50% with extended terms up to 50% longer than the original. Your business cannot grow with a high burden on the cash flow. Small business owners usually go for personal loans or term loans to consolidate their debts. However, a separate program for debt consolidation can meet all your business needs as the loan offering is designed to effectively take you out of debt. 

Conclusion

Business debt consolidation helps businesses work their way out of debt. Even with a credit score as low as 480, you can get a debt consolidation loan. Explore the above-mentioned steps and leverage this offering from REIL Capital to sustain an adequate growth rate for your business.

 

 

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