Consolidation debt rate is the rate of interest that a borrower is charged on a debt consolidation loan in order to get rid of multiple debts. The interest rate however varies from lender to lender.
Your credit score also determines the rate of interest charged on the loan. Credit score as rated by FICO is a three-digit rating that is based on your financial history. A credit score of 850 is considered as the best. A score of 600 and below is rated as poor and depicts that the person may have difficulty in obtaining credit. Therefore, one should take effective measures to improve the credit score. If the credit report contains certain unsolicited items, one should immediately report it to a credit rating agency and get it updated.
Borrowers with a bad credit history can also attain lower interest rates on the condition that they secure a collateral against debt consolidation loan. They have to ensure that the repayments are made on time else the lender can even seize the property.
Before going a debt consolidation way, the borrower needs to keep few things in mind. He must be aware of the rate prevalent in the market. The actual rate charged on the loan...