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During the financial crisis of 2009, when many of the most developed countries were going through big problems, Australia had somehow managed to escape the worst. But even then, there were many cases of small and medium sized businesses closing down with some declaring bankruptcies, mainly because they had overextended themselves financially. The availability of easy credit from banks competing with each other to make money, without any proper background checks, was found to be root cause for this crisis. Debt Reduction Loans With the onset of tighter and stricter controls by banks and financial institutions, there was a sudden credit squeeze, and people and companies found it hard to get loans, leading to a lot of problems. Financial companies and credit card companies started pestering loan defaulters, which lead to debt management companies coming up with solutions to sort out this problem. One of the key tools used by debt management services has been the debt consolidation loan which can reduce some of the debt burden from the debtor. This kind of debt consolidation loan is arranged by a qualified and experienced debt negotiator who can help give in giving you a new lease of life by managing your existing debts, and ensuring that you make regular payments at much lower interest rates to clear off the remaining debts over a longer period of time. Improve Credit Ratings These main purpose of obtaining a debt consolidation loan through a debt management services company is to help you to take care of your most urgent and critical debts. The debt managers will also take into consideration other outstanding dues that may have accrued over a period of time like overdue mortgage payments, credit card bills, personal loans, medical bills, etc. The debt negotiator will assess your current financial status before arranging a meeting with a loan provider, and will finalize the repayment schedule on a monthly basis. Debt consolidation loans can also help you improve your credit rating and history, which would have had a negative outlook, if there was any official loan default. Based on your resources, the debt consolidation loan could be either a secured or unsecured loan. Proper Mortgage Assessment In Australia, if you own your home you have the advantage of getting a secured loan from the loan provider, when negotiating for a debt consolidation loan. A secured loan can be obtained with a lower interest rate as well as extend the payment period when compared to a non-secured loan. Important payments like mortgages can be adjusted with a debt consolidation loan, and using a mortgage calculator with taxes allows you to work out an estimate of the maximum amount you have to set aside after taking into consideration cash inflows like your monthly income, expenditure, and interest rates. The calculators available with debt management companies are a great instrument to assess your mortgage payment options; however, they are only a guide to give you an approximate figure of how much you will have to pay. Author has many years of experience in content writing. He is the most celebrated and acclaimed author in financial sector. His many articles have been published online. Now he is writing for Debt Negotiators and providing information on mortgage calculator with taxes and debt management services.
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