Some investors refuse to use them, while others love them as a quick way of getting a company the capital it needs.Convertible notes are sometimes viewed as a “best of both worlds” compromise from both a company perspective as well as from an investor’s perspective: on the one hand, a note is a loan, so the investor enjoys more downside protection than would an equity holder in the event the company is forced to wind up or dissolve for whatever reason; on the other hand, if the company eventually raises money by selling shares to later investors in a typical early stage financing round, then rather than pay back the outstanding amount in cash, the principal and interest are “converted” into shares of stock in the company (usually at some sort of discount off the price offered to new investors – I’ll discuss that below).The logic behind debt consolidation loans may seem sound and this type of borrowing can make great practical sense, but you need to beware of the pitfalls that could make it go very wrong. Small loans, payday loans, overdrafts, store and credit card deficits can all charge extraordinarily high rates of interest, while the very best rates are usually only available on bigger loans.This means that combining all your debt into one consolidation loan could reduce the overall rate you pay, and possibly reduce the overall amount even if you pay over an extended term.In other words, the investor enjoys the downside protection typically associated with debt lenders, but is also positioned to enjoy the upside opportunity typically enjoyed by equity holders.As with any tool, before you use it effectively, its best to understand the pros and cons of each of its features and how they can be used for your individual circumstances.Unlike debt restructuring or consolidation where you must take out a new loan to pay your creditors, we simply enable you to make one convenient monthly payment to ACCC instead of making multiple payments to creditors.
As a non-profit agency committed to helping consumers who have credit problems and too much debt, we offer free counseling and affordable debt relief programs designed to pay off debts within five years in most cases.
On 2 December, 2014, found that only 28% of the 126 unsecured personal loans listed on the matrix of independent financial researcher Defaqto had no fee for early redemption of the entire loan.
Make a list of all your existing debt and check the small print, then factor any additional costs for repaying early into your sums.
Most clients in our debt programs find that making one payment per month helps to simplify their finances, reduces the stress of owing money and enables them to stay current with payments more easily.
We'll also contact your creditors to try to lower your interest rates, eliminate late fees and over-limit charges, to reduce your monthly payment and to shorten the amount of time it will take to pay off your debts.
Over the past 22 years, our debt relief programs have helped tens of thousands of individuals and families pay off their debts and live debt-free. Debt relief programs at ACCC are designed to help you take control of your finances and make a plan to pay off your debts.