When looking at ways to tackle growing debt, consolidation is an important option to consider. More and more families are using debt consolidation as a way to pay off unsecured loans and credit cards because it provides a way to rebuild credit while paying off existing debts.
The main perk of debt consolidation programs is that they can reduce your interest rates. Lower interest rates mean that more money goes toward monthly payments, giving you the opportunity to pay off outstanding loans sooner. If any of these five indicators describe you, it may be time to give debt consolidation a second look.
- You’ve been turned down for a loan due to poor credit. The beauty of consolidation is that it is not a new loan, and it does not negatively affect your credit score. Instead, it helps you pay off your cards more quickly, improving your debt-to-credit ratio and pushing your score up.
- You have high interest rates of 20 percent or more combined with high balances, you could be paying hundreds just on interest alone. Debt consolidation reduces your interest rates so more of your money goes toward paying the balance of your debts.
- You owe more than $10,000 on credit cards, personal loans and store lines of credit. The five-figure range often feels overwhelming. When you consolidate your debts, you can rest easy knowing that you have a plan and a target for paying off your debt.
- You have multiple outstanding loans and credit cards. The more loans you have, the harder it can be to remember to make payments. Even if you have the money, forgetting a payment will hurt your credit score. Debt consolidation programs automatically make payments.
- You have hopes and dreams for the future. We live in a world where money is required to make dreams happen. The less money you’re spending on your debts and high interest, the more you can afford to invest in business opportunities, college education or home payments.
If you feel that you could use help getting out of debt, then debt consolidation may be for you. Over the years, this method has provided debt relief for thousands of American families, and it could do the same for you.read more