That can make it easier to focus on getting out of debt. People have saved thousands by consolidating higher-interest debts using a single, personal loan, this will not negatively impact your credit.Check Your Rate Now The term debt consolidation encompasses a wide range of options. Below, we’ll describe the various different ways you can consolidate your debt and explain the advantages and disadvantages of each particular option: Debt Consolidation Company There are many debt consolidation companies out there.Home Equity Loan (or HELOC) A home equity loan, or Home Equity Line of Credit (HELOC), allows you to borrow money against the value of your home.The size of these loans varies, but they can often be up to 75-80% of your home’s value.
A consolidation loan can sometimes lower your monthly payment, and that can give you enough breathing room to get back on track.
Which is why a consolidation loan can often prove to be a better option: it may allow you to get a lower interest rate, which would save you money over the long-run.
2) High monthly payments People with lots of debt also frequently struggle with high minimum payments – which are sometimes more than they can pay each month.
If that’s the case, putting your house on the line may be too risky of an option for you.
Balance Transfer You might have seen offers for “0% interest” credit card balance transfers.