Many Danes have several loans, which they pay off every month. It is expensive and therefore it is a good idea to explore other options. In fact, the best solution in this regard is to take out a new mortgage. However, it is not any kind of loan. It is, on the other hand, a collateral loan.
Collateral loans are a relatively new concept in the Danish market. Therefore, not everyone has a knowledge of it. If you are unsure what such a loan can offer, you will get a closer introduction.
Why is it a good idea to collect your loans?
There are several reasons why it is a good idea to pool your loans in one. The main reason is the economic aspect. Having several small loans with high interest rates results in a total loan cost per month. month that is very high.
A larger loan typically has a lower interest rate. Therefore, you can save money by collecting your loans. At the same time, it is an option to extend the term of several of your loans, so that repayment of the loan amount is not nearly as urgent.
If you pay off monthly installments for several small loans, it will not only cost you dearly in the form of the installment, but especially in relation to accrued interest expenses. These expenses can be minimized with a collateral loan.
Create a better overview of your loans
If you have to pay off a large amount of loans, then it can be difficult to keep track of. By pooling them all into one loan, you also have only one repayment each month, making it easier to keep track of.
It also means that you do not have to worry about whether you end up forgetting to pay off a mortgage on one of your loans. If you find it difficult to keep an overview, then a collateral loan is a good idea.
Furthermore, it is also significantly easier to create an overview of the expenses you pay for your loan. Do you want to know about your interest rate, outstanding debt or maybe the total APR? If so, you can easily find it.
The more loans, the greater the savings
The more loans you have that can be combined into one loan, the greater savings you can get. Therefore, it is also a type of loan that should greatly appeal to you that has a large number of loans that you want to save money on.
This does not mean that collateral loans are exclusively for you who have many loans. If you have a few, but just want an easier overview, then a collateral loan can also be beneficial.
Nevertheless, you can be absolutely sure that the more loans you have, the more money you will save. It is not unheard of that people have saved more than DKK 10,000 in loan expenses by putting their loans together.