Families with small children often don’t have that much time for themselves, especially for finding good solutions for their financial struggles.
For one, it may feel daunting to look for all the options they have in terms of loans.
No matter where you read this blog from – whether it’s from the States, Britain, or even up north in Norway, it’s worth spending a few minutes checking your monthly costs, especially credit card bills, loans, and insurances.
It doesn’t take any more time, and I’d think that many would be surprised by how much they can actually save.
With regard to refinancing in particular, it seems like people with tight finances or credit card debt are underestimating their alternatives; few know what it could do for them, or how simple and easy it is to do.
This solution was also touched upon in a previous article of mine on getting out of debt, and today, I will share a new and friendly tip that might help you out as well.
What refinancing can do for you
To get this clear right from the bat, refinancing will not remove your debt – but it will make it more manageable.
The way it works is that you consolidate into one, the several loans that may be of different sizes.
You might want to do this because the payments are due at different times of the month, or because the interest rates are high for some, making it difficult for you to pay down the loans.
If you’re fortunate, you may even get lower interest rates on the new loan.
This way, you only have to make sure you get one manageable payment done each month.
Knowing whether refinancing is a good option for you becomes easier if you try…
Refinancing calculators
By performing a simple assessment that takes you only 5 minutes with a refinancing calculator, it is easy to see if and how much you can save by consolidating your loans.
Here is one I recommend and used (it’s in several languages): Refinansiering kalkulator – Lånekalkulator for Refinansiering
Whatever country you are in, many banks and financial services provide free and easy-to-use calculators for consolidating your debt into one new loan.
Just go to Google and type in “refinancing calculator” (or use the one I used), insert the numbers that are asked for, and in a few minutes, you’ll know whether it’s something for you.
When is refinancing a good idea?
As mentioned above, refinancing is usually a good idea if you check one of the following boxes:
- You’re struggling with repaying your debts, something that’s usually because…
- You have several small loans that are due at different times of the month, making it difficult and unnecessarily time-demanding to pay your bills
- You have a high interest rate on one or more small loans that you want to see if you can lower
If any of the above rings true to you, it might be time to consider refinancing.
Before you apply for a new loan, however, you would be wise to first learn the pros and cons of consolidating your debt.
For example, it is actually possible to receive a higher interest rate on your new loan, depending on the terms you qualify for – something that is based on your credit score, income, and other factors.