How to get a single EMI for multiple loans? – Unlocking the concepts of debt consolidation

One can get a single loan for multiple EMIs through debt consolidation. A loan is a form of debt that a person bears; not only do they need to repay these debts to maintain their CIBIL score, but they also have to pay interest on them, which can result in paying more than the principal amount. Fintech companies like Loans Jagat provide a proper route for their clients to consolidate their debts without causing any further financial burden and hardship to meet the limit.

Key takeaways: 

1. Debt consolidation is the action of consolidating multiple debts into a single loan at low interest rates.

    

2. The major function of loan consolidation is to relieve the financial burdens from the client’s shoulders. 

    

3. Debt consolidation generally takes a longer tenure to cover the loan principal amount. 
    
4. Debt consolidation also builds the credit score in the long term after lowering it initially. 

Single EMI for multiple EMIs at a glance: 

Can I get multiple loans? 

Yes, one can get multiple loans without any major problems. These loans can be home loans, auto-mobile loans, gold loans, personal loans, etc. 

Loans are not limited to larger amounts, but one can get them with shorter amounts also, like your credit cards. It provides you with short-term loans daily, which you need to repay with interest rates to boost your creditworthiness. Loans can also be taken in larger amounts in crores for bigger aims like business, education or home. Every loan comes with a burden to repay, which is termed as “EMI” in economic language. 

For example, people are buying 175,000 rupees for an iPhone on EMI, where they need to pay a certain amount of money every month for 12 months or 24 months accordingly. At the same time, one can get another short-term loan for 600,000 rupees. 

Hence, this proves that one can get multiple loans at a single time. But there are certain things to consider, which are the following: 

1. Multiple loans are only given when the credit score is better. 

    

2. If the credit score becomes a barrier, one needs to clear the existing loan to get the other loans. 

Hence, getting a loan is easier than repaying loans, and one can get these loans easily whether they want to take 3 loans or 6 loans from different banks. 

Read More - Single EMI for Multiple Loans with Bad Credit
 

What is the concept of single EMI?

The concept of a single EMI refers to ‘debt consolidation’. Simply, it combines your multiple debts or loans, as discussed above, into a single loan. 

This sounds very relaxing, and yes, it is. Many people turn their multiple EMIs into a single EMI to mitigate all the financial burden into one burden. Moreover, the concept is much less confusing. This is because banks like HDFC, KOTAK, ICICI, IDBI, IDFC, etc. provide the best debt consolidation offers. 

These are the reasons why people choose a single EMI over multiple EMIs: 

1. A single EMI comes with one due date every month, so people cannot get confused about when to pay for what loans. 

2. A single EMI means a single interest rate, which means one needs to only overcome the principal amount of the debt consolidated. 

3. A single EMI also acts as a credit antidote because it kills all the negative activity going on in your credit score because of messed-up financial activity.

4. A single EMI also pushes a person to repay the debt regularly. 

Hence, this is why people often choose a single EMI over multiple EMIs.

Are debt consolidation and loan consolidation the same? 

Yes, debt consolidation and loan consolidation are the same concept in finance, but the only difference is in their nature; debt consolidation is a broader concept and loan consolidation is a narrower concept. 

These are the features of debt consolidation and loan consolidation: 

1. Debt consolidation refers to converting multiple debts into one form of loan, which includes debts like credit card bills, medical payments, etc. It does not limit itself to only loans. 

2. Loan consolidation refers to consolidating loans, like student loans, car loans, home loans, etc. 

Hence, these are the only differences between debt consolidation and loan consolidation, yet in financial terms, both are explicitly the same. 

What is the difference between personal loans and debt consolidation loans? 

A personal loan refers to the loan given by the bank for any purpose. Whereas debt consolidation is given by combining the debts into one form of loan, which needs to be repaid every month in the form of instalments. 

Personal loans and debt consolidation loans both act as the bread of life but just on opposite sides. One is used for multiple purposes, and the other is used to combine those multiple-purpose loans into a single loan. 

These are the certain banks that offer personal loans at certain interest rates: 

Hence, personal loans vary from bank to bank, and debt consolidation is a form of personal loan. So, the concept becomes personal loans > debt consolidation > loan consolidation. This is how the consolidation concept narrows accordingly.

How to combine multiple loans into one EMI? 

Combining multiple loans into one EMI needs proper financial analysis and income understanding. 

While the concept seems easier, the application is much more complex. One needs to understand the loans or debt they bear, the amount of finances they are holding, the analysis of credit scores, and most importantly, which bank to trust. Therefore, Loans Jagat helps to settle all these doubts into simple answers without any confusion. 

These are the important steps one needs to follow to combine the multiple loans into one EMI: 

1. Analyse your current debt = understand your current debt and analyse it, which you can repay without consolidation and which needs consolidation. 

2. Analyse your score = get your credit score checked to know whether you are eligible to take on debt consolidation or not.

3. Approach banks = understand which banks are providing you with debt consolidation at what interest rate. 

4. Apply to the bank = apply to your selected banks and pay a lump sum of money to activate the debt consolidation loans to clear off the debt.

5. Continue paying EMI = once the debt consolidation loan gets activated, pay the monthly instalments regularly. 

Hence, this is how you can combine the multiple EMIs into one. 

What is the eligibility for debt consolidation? 

One needs to have a credit score of 700 points to get the debt consolidation loans. Though some banks approve the debt consolidation loan at 600-650 credit points. 

These are the eligibility criteria for the debt consolidation loans: 

Also Read - 7 Signs You Need Debt Consolidation
 

Hence, these are the eligibility criteria for debt consolidation; it only shows the flexibility for credit score, which can be pulled down to a minimum of 600 for certain banks, but the interest rate will go higher. 

Which bank offers debt consolidation loans? 

Banks like SBI, HDFC, IDFC, KOTAK, etc. provide debt consolidation loans. 

Hence, these are the banks that provide debt consolidation loans at favourable interest rates with long-term tenure. 

Bottom line: 

Turning multiple EMIs into a single EMI is a smart choice and needs smart financial planning, which is not complex but easy. A company like Loans Jagat provides the proper guidance to consolidate your debts. This is because debt consolidation not only boosts your credit score but also stabilises your financial position in the economy. Several banks like HDFC, Kotak, ICICI, etc. provide proper debt consolidation services to mitigate your financial burden and lead a simple, single EMI life. Hence, debt consolidation is the choice to lead a better financial life in the future, and one needs to understand that it is not for everyone.

FAQs

Which banks provide debt consolidation loans? 

Banks like HDFC, ICICI, IDFC, KOTAK, IDBI, etc. provide debt consolidation loans to people with favourable interest rates and processing fees. 

Do banks offer loans to consolidate debts? 

Yes, almost all banks, like ICICI or any other gramin bank, offer loans to consolidate debt easily, but one needs to repay the instalment every month to maintain and boost the COBIL score. 

Does SBI offer debt consolidation loans? 

Yes, SBI does offer debt consolidation loans, with an interest rate of 10% per annum and up to 5,000,000 in loan disbursement. 

Which NBFC provides the debt consolidation loans? 

NBFCs like TATA Capital, Aditya Birla, InCred, etc. provide debt consolidation loans at favourable interest rates. 

Can I get a loan with a 650? 

Yes, one can get a loan with a 650 because many banks allow this margin of the credit score with higher interest rates, especially while allowing for debt consolidation loans. 

Does the CIBIL score reset after 7 years? 

Yes, the CIBIL score resets after 7 years because this is a legal practice, but once the credit score is recorded, it cannot be changed or erased for the next 7 years.

Can I be jailed for credit card debt in India? 

No, one cannot be jailed for credit card debt in India; hence, it will create a debt trap for you, increasing the debt burden until you clear it at once. 

What is a personal loan?

A personal loan refers to a loan given for any usage; it is not concentrated on one particular reason. The borrower can use the personal loan for anything they want. 

What are 7 types of loans? 

Auto loans, personal loans, mortgage loans, student loans, home equity loans, payday loans, and business loans are the 7 types of loans. 

What is a credit report?

A credit report is the summary of your financial transactions, which highlights every single detail of your financial activity through which the credit score is estimated.