A great consolidation loan is a lot like a great partnership – numerous parties coming together to create something more than the sum of their parts. In the case of popular music, it can be two people forming an unbreakable combination that tops the charts. In the case of your finances, it is bringing your existing debts together so you can manage them all in one easy payment. In both cases, they need to be cohesive and sustainable.
Of course, these don't always work. Without the right planning and understanding of what the outcome is likely to be from a consolidation loan, it can fall flat and you may end up worsening your debt situation.
With this in mind, here are some less successful partnerships from pop history – and how you can apply these principles to your finances for a successful consolidation loan.
"We Are The World" – don't go overboard
While always done for a fantastic cause, the famous renditions of this song showcase what can go wrong in both music and finance. Despite boasting an all-star cast when the song was re-recorded in 2010 to support those impacted by the devastating Haiti earthquake, the song was met with critical panning.
Since "We Are the World" stood for such a great cause, it made it hard to admit it was a terrible song.
— Troy Nelson (@thetroynelson) May 6, 2013
With stars from Justin Bieber to Will.i.am, Josh Groban to Barbara Streisand all involved, the song was certainly overstuffed. This is something to be aware of with your consolidation loan.
Packing too many debts into one package can result in an unsustainable mortgage or refinancing deal that you can't keep up with payments for – working within your means is key!
"Say, Say, Say" – find the right producer
When Paul McCartney and Michael Jackson teamed up for this 1983 single, people expected big things, and perhaps a new RnB sensation. However, the softer 80's production that emerged irked many – and provides us with a valuable lesson for consolidation loans as well.
Even if you have the right debt components to be rolled up into one loan, make sure you work with the right mortgage broker. Like a good music producer, the right mortgage broker will understand what works well for your finances, and can provide a number of options that can aid your financial issues.
For example, the right broker will understand that short term debts like credit cards don't need to be stretched out over the same term as a home loan – and they'll help you structure debt accordingly.
Not every consolidation loan is going to be as big a hit as Diana Ross and Lionel Richie's "Endless Love" – but with the unique mortgage solutions offered at Mortgageport, you could find yourself producing a number one hit debt reduction.