Consolidating your debt

The following four steps will walk you through calculating how much debt you have, choosing the debt consolidation loan, setting a timeline to be debt free and teaching you how to control your spending.Here’s how credit card consolidation works: You first decide if you want to take out a new loan, open a new credit card or enroll in a debt management plan (more on that later).

Options to consolidate your credit card and other debts include a balance transfer credit card, an unsecured personal loan, a home equity loan or line of credit and a 401(k) loan.Do you feel like your life is on hold because you’re trapped by all your debt payments? Consolidating your debt could be the answer you’re looking for.It can help lower your monthly payments and get you out of debt faster so you can be in the driver’s seat of your own finances.You’ll also have to avoid the temptation of making further charges during that time. Fixed payments ensure that you’ll pay off debt on a set schedule.Debt consolidation offers debt relief by consolidating your monthly debt payments into one affordable payment.You’ll pay fixed, monthly installments to the lender for a set time period, typically two to five years.

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