Have you heard about debt consolidation? This method is believed to be a solution that you can take in order to pay off debt more easily. In essence, you can combine several types of debt into one, then pay it off with lower installments. However, how do you choose the right credit card debt consolidation program?
Before discussing further, let’s remember again what is the definition of credit card debt consolidation:
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Basically Debt consolidation is a step taken to make it easier for you to pay off the combined types of debt into one debt to a financial institution other than a bank (for example finance company and company peer to peer lending).
Usually there are several advantages of debt consolidation that you can get. First, you no longer have to bother paying debt separately to several banks at once. So with debt consolidation, the entire process of paying various credit card debt or PSA is only done through one door. This can be very troublesome, especially if you are a fairly busy person. In addition, the advantages of other credit card debt consolidations are with lower interest than normal interest.
There are two types of debt consolidation, namely using collateral and not using collateral. Both have their own advantages and disadvantages, and can be obtained in accordance with the terms and conditions provided by non-bank financing institutions.
Now, Sperilium is working with institutions finance company and company peer to peer lending trusted in Indonesia. This is done as an effort by Sperilium to help our clients in leading a new life free of debt, which is integrated into Sperilium’s debt management program. Here are two types of debt consolidation programs available at Sperilium:
Types of Debt Consolidation Programs
Consolidation with Collateral
As the name implies, debt consolidation with this type is done using collateral. In most cases, it is usually the type of asset that can be pledged as property, especially housing. In other cases, you can also give the car as collateral.
To participate in a consolidation program with collateral, debts that are still running can be in arrears and smooth. So, even though you haven’t been in arrears, you can take this step as a preventative step in order to pay off the debt with a temporary relief while still having funds. For those who have been in arrears, Sperilium will also help conduct the negotiation process before the debt is consolidated. So, you can pay off the debt even more lightly.
Sperilium provides this type of program by collaborating with several well-known multifinance institutions in Indonesia such as Astro Finance and Globe Finance, to assist our clients in obtaining a debt consolidation program.
Unsecured Consolidation: Card Cutter and Card Cutter Plus
Of course this type of debt consolidation is more suitable for those of you who do not have assets. Sperilium works with a company peer to peer lending well-known in Indonesia, KoinWorks, to provide this program to our clients. As one of the startup companies in the field of financial technology in Indonesia, of course you already know KoinWorks as a company that provides low interest loans. There are two types of consolidated programs without collateral:
In this type of program, you can consolidate several credit card / PSA debt with a minimum of a total of 10 million Rupiah. In the Card Cutter program, debt conditions are usually not in arrears. You do not need to use any collateral, just register in the Card Cutter program (assisted by a professional consultant Sperilium), then some types of debt will be replaced by one new debt.
Card Cutter Plus
In this type of program, you can consolidate several credit card / PSA debt with a minimum of a total of 10 million Rupiah. The difference is the usual debt conditions already in arrears , then before consolidating into one, the debts will through the negotiation process first in order to get the cut. Of course this will make your debt even lighter, and easier to pay off. As with Card Cutter, you also don’t need to use any collateral. Simply register yourself in the Card Cutter Plus program (assisted by professional consultant Sperilium).
How to Choose the Right Debt Consolidation Program
Choose Borrowers who are already registered with OJK
The first step to finding a debt consolidation program is to choose a borrower who does have a good reputation. The first benchmark is of course by checking whether the borrower is registered with the OJK, because as an institution that has the authority over financial institutions that manage funds, of course the OJK will select its members.
Usually, borrowers registered with OJK can also be more trusted in their ability to maintain the information and personal data of prospective borrowers. Not to mention, for personal financial matters, of course you don’t want to carelessly access your data, right? Some types of financial institutions that you have to check their names in OJK are not limited to banks, multi-finance (financing), and companies peer to peer lending.
Shows you a clear payment scheme until the loan is successfully repaid
After choosing a borrower who provides a debt consolidation program, of course you also have to know how to register, and see the payment scheme that you will do. If indeed the installment payment is made for the next 24 months (two years), then see if the table provides clear details, how much the nominal must be paid each month, along with the interest. That way, you can see clearly how the calculation is and whether you are capable enough to take part in the program to complete, so that the ongoing debt problem can also be quickly completed.
Installments per month paid should be lower than current installments
When you take part in a debt consolidation program, one that should be noted is the amount of installments per month that must be paid. Normally, the monthly installments must be lower than the installments you pay today. Suppose you currently have two credit cards and one PSA that are in arrears, if accumulated all the total outstanding debt is IDR 100,000,000, then installments per month that must be paid cumulatively in the amount of IDR 10,000,000, however, with this consolidation program, later the three types of debt will turn into one type of debt with one of the trusted peer to peer lending companies, and you only need to pay lower, just think of only IDR 300,000 per month up to a predetermined tenure and certainly more relieve you. Of course not all schemes will work like this, it could be that the monthly installments are only Rp1,000,000 or even more, but what is certain is that the installments will be lower than the installments to the bank.
Fair Interest Rates with Reasonable Costs
Another thing you need to pay attention to is the existence of reasonable interest rates. Normally, the interest charged ranges from no more than 3% per month. It is important to remember that even though the interest rate is quite high, usually the monthly installments can certainly be lower because they are repaid in a certain tenor that has been adjusted by the borrowing company (the provider of the debt consolidation program). In addition, usually if you are charged a fee, the costs paid for joining the program should still be reasonable.
Guarantees that make sense
When participating in a debt consolidation program, there are usually those who ask for guarantees and some who don’t. In the Sperilium program, one type of asset that can be guaranteed is for example a house. Generally, if you are able to guarantee a house, the interest you get in installments can usually be much lower. If indeed there are no guarantees that must be pledged, you must also pay attention to what requirements must be met so that you can consolidate your debt.