Low Interest Debt Consolidation - How To Get the Lowest Rate
If your mailbox is stuffed with bills each month--credit cards, personal loans, auto loans and more--you might be thinking that debt consolidation can help you regain control of your finances. And you're right! It cuts back on paperwork, and in some cases it can help you lower your interest rate too! But before you sign on with a debt consolidation loan, make sure you're getting the lowest rate possible by checking out these options:
Home Equity Loan
A Home Equity Loan or Home Equity Line Of Credit taps into the equity in your home--the amount your home is valued minus the amount you still owe on it. You borrow against this equity, essentially using your home as collateral. These loans tend to have super low interest rates, and in many cases the interest you pay throughout the year is tax deductible, too! But don't sign up for one unless you’re absolutely sure you can make the monthly payments, since your lender can take your home if your loan goes into default.
Debt Consolidation Service
A debt consolidation or debt management service will roll all your bills into one monthly payment. You pay the service once a month, and they divvy your payment up among creditors. They may also be able to negotiate on your behalf for a lower interest rate, which could save you money in the long run. Watch out for scam artists who make promises they can't keep, though. Check out any debt consolidation service thoroughly with the Better Business Bureau.
Personal Loan
In some cases, you may be able to get a personal loan from a bank or credit union. And since the average interest rate on a credit card is about 18%, the loan may be able to help you lower the rate you're paying. Simply borrow the amount you need, pay them off, and then you'll only have one loan--your personal loan--to worry about.
As you look for a debt consolidation solution, be sure to explore lots of options. Many of them can help you do more than just consolidate your debt--they can help you get a lower interest rate too!
Our Recommended Debt Consolidation Lenders:
Helpful Tips:
1. Apply with more than one company to compare offers.
2. Study your options before committing to a debt program.
3. Cut out small luxuries to pay down debt at the beginning of your debt reduction program.
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authors and publishers are not providing legal or financial advice.
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provided on this website is based on information available at the time
of publication. ABC Loan Guide does not presume to advise people about
their personal financial situation.
Readers should consult a financial professional about their own
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