How to Get Approved for Secured Debt Consolidation

You may be able to get a debt consolidation loan if you are willing to put up something that you own as collateral for the loan, which is typically referred to as a secured debt consolidation loan. Some typical types of collateral include real estate, vehicles, boats, or other valuable pieces of personal property, and secured loans for the purposes of debt consolidation are not unusual. However, there are some simple steps that you can take in order to maximize your chances of getting a secured debt consolidation loan.

Choose an Appropriate Lender

You should research lenders in order to determine whether they accept the type of property that you are willing or able to put up as collateral for a secured debt consolidation loan. While most major lenders offer loans secured by real estate, or home equity loans, not all lenders will accept personal property as collateral, particularly if it is a form of property other than a vehicle or boat. If you choose a lender who is likely to accept the collateral that you are willing to offer, then you will have an easier time getting a secured debt consolidation loan.

Be Realistic About the Value of Your Collateral

Lenders are more willing to issue you a secured loan, even if your credit history is less than perfect, simply because you are more likely to make your loan payments if you risk losing your collateral if you don't. Additionally, a lender has collateral with which to recoup some of its losses should you default on a secured loan. As a result, do not expect to get a loan that is greater in value than the collateral that you are offering the lender as security for the loan. If you are unable to obtain a secured loan in an amount that will allow you to consolidate your high-interest debts, then a secured debt consolidation loan may not be for you.

Maintain a Good Credit History

It goes without saying that having a strong credit history will make you more likely to obtain even a secured loan. If you have a history of paying your financial obligations in a timely fashion, a lender is more likely to give you a loan. Plus, you will enjoy other, more favorable terms and conditions, such as a lower interest rate.

Contact an Attorney for Advice

If you need further assistance in considering secured debt consolidation loans, you should consult with an attorney, who can give you all of the available options for dealing with your debts, and help you make an educated decision as to your debt consolidation needs.