If you’re using multiple credit cards and you find yourself drowning in an ocean of high interest debt, paying them off and leading a debt free life can be a long and strenuous process. It’s very tough to make payments when you have to split them among 5-6 credit cards. If you’re in such a situation, you may feel how easy it is to pay off a single card. Here comes the necessity of consolidating your debts. No matter whichever way you’ve incurred high interest unsecured debts, debt consolidation must be the best debt relief option for you. Debt consolidation is nothing but combining your debts and bundling it into a single monthly payment. There are different ways in which you can combine your debt burden. If you’re not aware of the ways, read on.
1. Credit card balance transfers: Shopping around for low rate or even 0% interest rate cards will only make sense when you have the financial affordability of transferring your entire high interest balance into the low rate card within the introductory period. You must read the fine print of the credit cards so that you get to know the time period of the teaser rate or the low rate that you’ve qualified for. It is best if you can transfer your balance within the introductory period to avoid sudden interest rate hike in the near future.
2. Home equity loans: Secured loan consolidation is best for those who have accrued enough equity in their homes. This is an inexpensive and easy to obtain loan and you can tackle the monthly payments of this loan properly, you can successfully consolidate your high interest debts. As you’ll be taking out a secured loan, chances are high that you will grab low rates and an extended repayment term on your loan. You just have to make sure that your monthly payments are given on time to avoid any risk of facing a foreclosure. Most debt experts recommend that you must take resort to this option only when you have good repayment ability.
3. Debt consolidation loans: You may also take out debt consolidation loans from an authentic lender and combine your high interest credit card accounts. The debt consolidation loan is a master loan and carries drastically low rates that can ensure relaxed monthly payments. You just have to make a single monthly payment towards the debt consolidation loan and this will be disbursed off to your creditors in due course of time, making you debt free.
If you’re a debtor and you want to become debt free, you can resort to the above mentioned debt consolidation options. You can even renegotiate with your lenders and ask for better rates and terms in order to facilitate the debt repayment procedure.
