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Why should you Borrow to get ahead when using Debt Leverage?

Why should you Borrow to get ahead when using Debt Leverage?

People borrow money for every reason. Whenever they need money, they look towards banks, friends, or financial institutions to help them. However, the reason for the loan is not always justified. People take loans for all sorts of crazy reasons – a party, an outing, and other unnecessary expenses. These reasons might be unjustified; however, some really genuine reasons call for one to go under debt.

Debt looks unnecessary, but there are cases where there is no way out but to take a loan. Some of those conditions are given below, explaining when and why you should borrow money to move ahead in life.

To Save Your House

A great number of houses are mortgaged in the US. People are living in the fear of losing their homes to their lenders. This is one thing that scares all homeowners. If you are facing the risk of foreclosure, then taking out a loan to paying back your debt is a good option.

However, this is not the only option that one has in such situations. One should always seek help from a lawyer who specializes in such cases to find the best option out of this situation. One more thing to remember is not to make the same mistake of putting another property on the line to save one property, as it will not do you any good.

Almost all banks will require some kind of collateral to give you a loan; however, some companies or lenders might be willing to give you a loan to save your house in certain conditions. This option should be used when you are sure that you will not end up in trouble.


If an investment opportunity comes your way that can benefit you, then taking out a loan is a good idea. Risks are important in life and one can never move ahead in life without taking risks. However, one important thing is to minimize the risks involved. This isn’t easy but one should be able to do it before opting for a loan.

Foresightedness is required as these are very major decisions and cannot be made in haste. You can consult a professional or your friends to make sure the step you are taking is worth it. Not every investment gives the desired returns and can at times put you in serious financial trouble.

One more thing that you will need to do is find the difference between the profit you will earn out of the investment and the interest you will pay on the loan. If the profit isn’t more than the interest, then the option is pointless and something that should be totally avoided. However, if good returns are guaranteed then this is the best thing to go for.

Debt Consolidation

Debt consolidation to pay down higher interest rate loans is a good reason for taking out a loan, especially if you are sure you can manage it well. If you are already burdened with a loan that required you to pay huge interest, it is a good option to take a loan from a friend or a bank that is giving it at a lower interest rate so that your burden is reduced.

However, it should be managed well as it can, like any other loan, cause problems. Also, when you go for this option, make sure the terms and conditions of the second loan are friendlier than the former one because if they are the same then going to another lender will not be a good idea as it will not help you in any way.


A loan for education is usually acceptable; however, it depends on many factors. Firstly, consider whom you are going to sponsor for education and if the person is worth it. There is no point in taking out a loan for someone who isn’t good at school, as the person probably will have difficulty finishing college, graduating, finding a job, and then paying back the loan. However, this is very difficult to conclude due to the desire and importance of getting educated.

Many institutes and colleges have their own debt programs that are often interest-free to promote education. This option should be considered as it can be of great help.

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