USD/JPY clings to the consolidative note
Over the past couple of months the USD/JPY has held at a very low level, probably because of the Greek debt crisis. The main problem that has been brewing in Europe is that many banks are holding huge amounts of debt and due to the recent recession many of these people who hold these debts, have lost their jobs.
This has created a situation where most creditors are seeking to recover what they can from a consolidative note. The consolidation company will then take all the debts that are unsecured and convert them into secured loans. The company will then sell the loan to a third party at a much higher rate of interest than the debt holder would normally pay to the bank or other lender.
The new loan will be taken to pay off the original debts that have been converted into secured loans. As the consolidation company has made a profit from selling this loan it is not surprising that they will do everything they can to make sure that the person that received the consolidation loan has a good credit rating. It is a common practice for consolidation companies to look at your current credit rating and your past credit history before offering you a loan.
If you have a good credit rating then the loan will normally be for a lower rate of interest than if your current credit rating was less than average. In addition, if your existing loans are being paid off at a faster rate than the consolidation loan then it is likely that the consolidation company will try to offer you a consolidation loan at the same rate as these existing loans.
The key to obtaining a loan at a lower rate of interest is to ensure that you maintain a monthly income in order to make the repayments on the new loan. If you fail to make a regular monthly payment on the new loan, you are likely to lose your home to the consolidator. In order to reduce the risk involved in obtaining a consolidation loan, it is worth finding out what kind of mortgage your existing loan is linked to.
Many mortgage providers will charge a higher rate of interest on a consolidation loan because it means you will have to pay more upfront and be tied into a single loan rather than two separate loans. So make sure that you read the fine print of any mortgage you are considering taking out before you sign on the dotted line!