alternative to a credit card consolidation loan, you can work with your creditors and your budget to develop a plan to wipe out debt on your own.You might pay down your debts through a balance transfer or interest rate negotiation.If you’re one of the millions of Americans with overwhelming credit card debt, you may have looked into a credit card consolidation loan to tackle your debt.And while a consolidation loan for credit cards can be a good option when you have a lot of bills to pay off, there are plenty of alternatives to consider. Review your current financial picture and goals with a financial advisor or specialist certified credit counselor to determine the best plan for your needs.
Con #2: Another potential drawback to consolidating your debts, is that most people I know who have consolidated their debts have done so using a home equity loan (HELOC). If you fall behind in your payments on a non-secured debt, about the most that can happen is that you might get harassed by a bill collector.
Both put the control in your hands, which can be good or bad, depending on how disciplined you are.
Remember, you’ll need to not only put together a budget, but stick to it as well.
So, for instance: If the average comes to 6.15%, your new interest rate will be 6.25%.
Additionally, you’ll get a new loan term ranging from 10 to 30 years.