Ways to Consolidate Your Debt Yourself

Ways to Consolidate Your Debt Yourself:

Consolidating your debt is a good way to lessen your debt by combining various balances into a single loan with manageable repayment terms and low overall interest rates.

You have several debt consolidation options that you can consider even without the help of any debt management company out there. The best thing about debt consolidation is that you’ll still have the same amount of debt, but its main benefit is that you’ll need to rearrange your debt in a way that would make things much easier for you to pay off.

No matter how much debt you have, below are some of the ways you can take into consideration to consolidate your debt yourself:

• Credit Card Balance Transfer

One of the best ways to consolidate your debt yourself is through credit card balance transfer. It can be a great option once you qualify, especially when you have different credit card balances with various card issuers. The process of application is a bit straightforward, but you won’t risk any collateral and you can make a decision within a few seconds.

The drawback is low-interest or zero introductory APRs, which usually last for 18 months. It provides you less time to pay off your debt before your rate increases.

Due to this, ensure that you know what APR or annual percentage rate will be when your introductory period expires. Moreover, be aware that every card evaluates a balance transfer fee between three percent and five percent of the amount you transfer that could affect your ability to repay all your debts at the end of your introductory period.

• Personal Loans

Personal loans are a kind of unsecured loans that you may use for some reasons including debt consolidation. It’s one of the options you can consider if you qualify for low APR, relative to your debt’s overall rate. You don’t need to put up any kind of collateral, only your credit history and income will be used to determine your qualifications.

Once approved, your loan can have fixed payment amounts and a set repayment period, providing you predictable payoff schedules.

A personal loan is also available from credit unions, traditional banks, and online banks as well as repayment terms up to 12 years.

When you’re shopping around for personal loans, consider the repayment period and determine the origination fees. Making your debt repayment for a long period of time may lessen your monthly payments, but it means paying more interest overall. Origination fees are upfront fees that lenders add to the loan’s balance. When you’re comparing loans, check the APR since it takes both the origination fee and interest rate into account.

• Cash-Out Refinance or Home Equity Loan

You may borrow against your home’s equity with a cash-out refinance or home equity loan. Such frequently have high borrowing limits and low-interest rates since this loan will be secured by your house. Lenders consider financial and credit history to determine your rate and whether you qualify.

If you have a good credit score and steady income, there are many debt consolidation options you can choose from. Owning assets, including vehicle, home, retirement plan, and life insurance policy provides you the means to restructure your debt by yourself. However, if you’re struggling, ensure to seek help from the best professional debt consolidation company or credit counseling agency for you to sort out some of your options and pick the best one for you.