Non-profit Debt Consolidation Loans

February 13, 2009 by  
Filed under Debt, Debt Consolidation

A lot of non-profit debt consolidation loans can be found nowadays and people tend to choose this kind of loan above any other ones. If you have some small bills that you pay off monthly, a debt consolidation loan would be the perfect answer to your prayers. One debt loan can be taken out to pay off all your other debts and you will only have to repay them per month. It is a much simpler way to budget things and to remember payments; and, most of the time, it’s even cheaper.

Non-profit debt loans can be found at credit unions, which are cooperative associations that all of its members own. This differs from any other financial institutions, like banks, since those are owned by its shareholders.

Most people run to a finance company or a bank that they already transact business with the minute they realize they need a debt loan. If you have been transacting business with a bank for a couple of years now, then they will probably give you a debt loan since they know exactly what happens from within your account from your past savings or checking accounts.

For some, though, credit unions may be the better choice since they have more options to offer. Credit unions have a different set of rules and regulations compared to those that banks have and therefore have a completely different approach. Personal advice is given after evaluation of your financial situation with a credit union and the interest rate is usually much lower, as well.

Credit unions let members save and put money into the credit union. Other members may need to borrow money and they take it out. The interest that needs to be repaid goes to those members who have saving accounts, which then count as interest on these savings.

In the United States of America, the Credit Union National Association (CUNA) is in charge of regulating credit unions. Credit unions have a field of association, which chooses which people they give debt loans to; these are not open to everyone, however. They might choose their members from location, school, employer, or even church. You need to ensure you are in their field of association before joining the credit union and getting debt loans. To see the CUNA’s database on credit union locations, visit: http://www.creditunion.coop/cu_locator/index.html

Once a credit union takes you under its wing, you must also find out if they also offer debt consolidation loans. Ask for a quote.

It is pretty easy to figure out if the debt loan will financially help you. You can do this by taking a look at interest rates and comparing them to several of your smaller debts. If they are lower than your debt, then it is a good deal. You can also apply and ask for a quote, if you’d prefer. Just make sure you check monthly payments that they quote and see that it is less than the total payments you are currently making.

Credit unions tend to offer better debt loans than banks do most of the time. The majority of people who are eligible for debt loans would advise you to take non-profit debt consolidation loans over debt loans from any other financial institution, no doubt about it.

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