However, those who have not dealt with their money management issues may eventually accrue more difficult to pay debt and be forced to file bankruptcy.If you’re struggling under the pressure of your student debt, you’re not alone.But, consolidating student loans is not right for everyone.
There are many reasons why people consider debt consolidation.
However, it is important to understand that there is no easy out when it comes to debt.
For most this type of consequence is unacceptable, so they end up filing bankruptcy to save their home or vehicle.
Ironically, in some cases bankruptcy could have been avoided if the debtor had not used a debt consolidation loan and had negotiated with their individual creditors instead.
Debt consolidation loans often deliver better interest rates than most credit cards and other unsecured loans.
Many with debt consolidation loans find that both their monthly payment and interest rate are significantly lowered.
This extra money can be used to build an emergency savings account or used to make extra payments on their consolidated loan.
The irony of debt consolidation loans is the very thing that makes them appealing can also make them dangerous—low monthly payments that make repaying debt easy.
Student loan consolidation can be a great option if you’re looking to simplify and lower your monthly payments, but there are other factors to consider, so be sure to do your homework.
And while it’s easy to feel down about your student debt, look on the bright side: College grads earn over 0,000 more than the average high school graduate by retirement age.
But eventually they’re unable to repay the loans and are forced to file bankruptcy because the debt is just too much to handle.