Millions of people across the United States have credit problems for one reason or another. If that includes you, and you’ve grown tired of juggling all your credit card balances and outstanding loans every month, there are a number of strategies that you can use to consolidate your debt, and slowly but surely become debt free. Three of the best strategies are outlined below. Enjoy.
Strategy #1: Take out a Line of Credit.
If your credit rating is still good you might consider using a personal line of credit from either your bank or your credit union in order to consolidate all of your debts. The good news is that in order to qualify for a personal line of credit you don’t need to own a home and, in many cases, the bank’s decision to give you credit, and access to the cash you need to pay off your debts, might come in under a week.
Once you have the money you can pay off all of your debts in one fell swoop and, instead of several different accounts to worry about, you’ll only have one single bill to pay every month. Of course the interest rate that you will get on your personal loan depends on the actual credit score that you have and, the higher it is, the better interest rate you will get.
Strategy #2: Consolidate all of your Credit Cards.
Many American consumers have several credit cards and struggle to keep track of all of them, and make payments on time, every month. This strategy consolidate all of those smaller credit card bills onto one single card and, if you can find one with a 0% transfer rate for 12 or 18 months, you’ll not only be able to pay only one credit card bill every month but pay less in interest fees as well.
Of course this means paying off as much of that debt as possible during the low rate balance transfer period that the credit card gives you. If you don’t do that, you might only have one credit card bill to pay every month but you’ll still be paying a lot of money in interest.
Strategy #3: Take out a Personal Loan.
If you have good credit and a good relationship with your bank or credit union, you can take out a personal loan to pay down your debt. The average personal loan usually comes with a fixed interest rate that is lower than the typical credit card interest rate and, once you qualify, you can simply choose the amount that fits your budget and pay off that amount every month.
If you have the credit necessary to qualify you’ll get a great low interest personal loan, be able to pay off your debts and, when the loan is paid in full, be debt free. You’ll also have some great credit history because you’ve taken a personal loan, paid it off on time every month and paid it in full.