Consolidating credit card debt information
The debt includes a two-year loan for ,000 at 12% and a four-year loan for ,000 at 10%.Your monthly payment on the first loan is 7, and the payment on the second is 3. If you make monthly payments on them, you will be out of debt in 41 months and have paid a total of ,821.Their behavior hasn’t changed, so it’s extremely likely they will go right back into debt.Let’s say you have ,000 in unsecured debt—think credit cards, car loans and medical bills.So basically, your debt would go from ,000 to ,000–60,000.
We’ve already covered consolidation: It’s a type of loan that rolls several unsecured debts into one single bill. Debt settlement means you hire a company to negotiate a lump-sum payment with your creditors for less than what you owe.
Something has to change, and you’re considering debt consolidation because of the allure of one easy payment and the promise of lower interest rates. But the truth is debt consolidation loans and debt settlement companies suck even more. In fact, you end up paying more and staying in debt longer because of so-called consolidation.
Get the facts before you consolidate your debt or work with a settlement company.
To do that, you have to change the way you view debt!
Dave says, "Personal finance is 80% behavior and only 20% head knowledge." Even though your choices landed you in a pile of debt, you have the power to work your way out! The solution isn’t a quick fix, and it won’t come in the form of a better interest rate, another loan or debt settlement. But let’s be honest: Your interest rate isn’t the main problem. This specifically applies to consolidating debt through credit card balance transfers.