When you have several credit cards with debt for each one, you need to make several payments per month, which is not convenient and very expensive. So you start to think about credit card consolidation strategies.
In this case, a good way to make your life easier, is to consolidate all credit card debts into one. You will receive a lower interest rate and less payments per month. Of course, you should not grasp the first available option that the lender will offer you. It is necessary to examine all the options available to you carefully.
Find out how much you can afford to pay monthly, as well as the state of your balance on all cards. It is necessary to calculate your strength, so as not to create more problems, putting yourself in even more difficult situation. Let’s find out what can be done to consolidate debts.
- Personal loan
You can take a personal loan for this purpose in order to close all credit card debts at the same time and then pay off a single personal loan. You can apply to almost any credit company for a personal loan, while the annual interest rates on personal loans are usually noticeably lower, than on most types of credit cards.
This may be an online loan, credit union or a bank, but in the case of a not very high credit rating, the chances of getting a loan from a bank are sharply reduced, while the online loan still leaves high chances of approving a personal loan.
- A loan to buy equity
Such a loan has a fixed annual interest rate as opposed to a variable interest rate on credit cards. The security of this loan is your house, or other expensive property, but the credit line on a card depends on the level of balance.
It is worth paying a lot of attention to studying all the nuances of a loan for the purchase of equity capital, in order to make the right and well-thought-out decision. Such a loan will mean the risk of your property for many years.
- Balance transfer from one credit card to another
Transferring the balance to a card of another lender with a better interest rate has another great advantage, which makes this process very profitable for you.
Most companies offer a grace period of free use, when the interest rate is 0%. This period usually lasts from 6 to 18 months, which gives you temporary odds in paying the debt without paying interest.
This is a great option if you have good credit. It is also worth considering that the process of balance transfer is paid and usually costs between 3% of the amount transferred to another card.
- Contact a family member or good friend
If you have someone of trust, then you can ask them for financial help. To do this you need to understand that by borrowing money from loved ones you risk your relationships with them. Although borrowing money without interest may look like a very attractive option, but you may loose valuable connections.
- IRA or 401k
You can use the money from your retirement fund to pay off debts. This is your money and you have the right to dispose it at your discretion, but it’s worth remembering, that this is your pension, your provision of vital needs at a time, when you will be much less efficient.
- Collaboration by credit counselors
You may not imagine how many options exist for you to cope with your situation, that has developed with your debts. Probably you don’t need to take another loan to solve these problems.
There are companies and specialists who know a lot of ways to get out of a financial crisis, if a person finds it difficult to cope with financial obligations. They will help you draw up a plan to pay your debts even without additional loans, the only cost will be a small payment for their work, a meager compared to losses from problem loans.
Seek help from professionals
When your financial situation has deteriorated, began to seem confusing and difficult to you, contact the professionals. Credit card consolidation strategies may seem like a tricky process, but there are people with professional knowledge who can help you to cope with this task.
You can find on our website a lot of useful information about loans. Write us a message and be sure that our experts will be able to help you understand the difficult financial situation.