If you are a non-home owner or live as a tenant, it is important for you to clear your debts before they assume unmanageable proportions. If you cannot do this on your own, the best way to get rid of your loans would be to opt for an unsecured debt consolidation loan. This is considered a high-risk loan and is available to applicants who are unable to provide collateral and even to people with bad credit. The loan is meant for paying off all the different debts of the borrower and consolidating all debts into one single loan that is repayable over to a longer period of time and at low interest rate. It carries low monthly repayments. This frees the borrower from the problems of multiple creditors and different installments to be paid on different dates.
These loans are given without any security and so the lender faces a higher risk. High-risk debt consolidation loans are given at relatively higher rates of interest. The loan approval also is given for amounts much less than what are generally approved. The period of repayment is also limited to between five and fifteen years at the maximum.
These loans are suitable for people who do not have property of their own, but homeowners are also eligible for availing unsecured debt consolidation loans.
If you intend to take the loan for the purpose of reducing your monthly outgoing, it would be advisable to shop around for a loan that carries the lowest interest rate. You can do this by comparing the interest rates being charges by various loan providers on unsecured debt consolidation loans. If you have a high credit score and established repaying capability, the loan can be available to you at a considerably low interest rate. In any case, it pays to conduct research prior to applying for a loan.