What is military debt consolidation, and how can you get it? Consolidation in general just means combining all your payments into one. If you are serious about trying to get rid of debt, then there are a couple benefits to consider.
For one thing, it helps organize the finances better. After all, trying to track payments that are coming due at all different times of the month can be extremely challenging. Also, the interest rate is generally reduced on these loans, because there is usually some form of collateral involved.
Some loans are specifically for either people who have served, or those who are actively serving-hence the name military consolidation loans. A lot of different companies offer these to those who have been in the service.
What effects the rate? They are the same as loans to non-military citizens. In other words, your credit score is the main thing that will determine your monthly payment.
So are they a good option? Even if you do get a better interest rate, they are still very dangerous. This is because you have to provide collateral to get this lower rate. Therefore, you are at risk of losing your personal possessions. In most instances your home is what is used, so you could very well not have a place to live if you default on this payment.
For this reason, a better option than a loan would be credit counseling. There is less risk, because you are not getting a loan. Therefore, you do not have to worry about any of your personal items getting taken because you are defaulting.
Therefore, if you do get a loan, make sure that you can pay it back. If you are serious about it, make sure you shop around extensively before choosing the best firm. This will help you find the lowest interest rate. Also, make sure to find military debt consolidation companies that allow you to consolidate any type of debt. However, in general, credit counseling is your best option.