Debt Consolidation Loan vs. Multiple Loans: Which one saves you more?

Managing finances efficiently is one of the most persistent challenges of modern life, especially when you are juggling multiple Loans. From Credit Card bills to Personal Loans, consumer durable EMIs to Education Loans, the sheer number of repayment obligations can feel overwhelming.

However, a Debt Consolidation Loan steps in as a strategic solution. Instead of paying multiple EMIs across various lenders, you merge them into one consolidated Loan. But does consolidating save you more compared to sticking with multiple Loans? Let us understand in detail.

How does Debt Consolidation help?

High Loan amount

You can avail a Loan amount up to Rs. 30 lakh* for debt consolidation.

Apply online

You can apply for swift debt consolidation. You can upload the documents digitally; the entire process is hassle-free and easier to manage.

Lower interest rates

Debt consolidation comes with attractive interest rates. The interest rates can be as low as 13% per annum*.

Longer Repayment Tenures

Debt Consolidation Loans typically offer flexible repayment options up to 60 months. A longer tenure can reduce the EMI burden and ease monthly budgeting.

Clarity and control

You are instantly informed about your eligibility after submitting your online Debt Consolidation Loan application, which gives you better control over your finances.

Documents required for debt consolidation

• Identity proof and age proof
• Signed application form
• Passport-sized photograph
• Address proof
• Bank statements
• Salaried individuals have to submit 3 months' salary slips
• Self-employed individuals must submit Income Tax Returns
• The lender might ask for additional documents based on your profile and Loan type

How to consolidate your debts?

Debt consolidation helps you combine several Loans into one. You can take a Personal Loan for debt consolidation at a lower interest rate and a flexible tenure. The remaining EMIs are paid off from the new Personal Loan.

Swap high-cost debt with low-cost debts

Sometimes existing Loans can be hard to manage. Moreover, if you miss EMI payments, the interest rates on pending EMIs, along with a penalty, increase your credit costs. To avoid such circumstances, you can get a Personal Loan at a lower interest rate. Many lenders offer a Personal Loan for debt consolidation, where interest rates start at only 13%.

Single vs. multiple EMI payments

A Personal Loan for Debt Consolidation combines multiple EMI payments into a single payment with a single due date. It simplifies the repayment process with a fixed single EMI.

Disciplined payment

With debt consolidation, you get a more structured approach to Loan repayment. It becomes easier to remember one due date and a specific amount you have to pay each month.

Conclusion

So, Debt Consolidation Loan vs. Multiple Loans, which one saves you more? In most cases, consolidation is the smarter option if you are dealing with high-interest Credit Card debt or struggling to manage multiple EMIs. It can lower your interest outgo, reduce financial stress, and help you regain control of your money. However, the key lies in careful planning.