Consolidating credit card debt into a personal loan

10-Oct-2017 08:16

“It really depends on the person and the type of debt,” Germano said.

“A debt consolidation loan can help you manage your payments easier and less stressfully.

C., said this topic comes up “pretty frequently” with her clients.

“Most of my clients have credit card debt,” she said.

Cash-out refinancing involves replacing your mortgage loan with a new one for more than you owe, taking part of the difference between your old and new loans in cash. A home equity loan gives the borrower access to home equity in cash, which can be used to pay off other debts.

A home equity loan does not replace the existing mortgage as a cash-out refinance does, but it is another loan in addition to the existing mortgage.

HELOCs differ from home equity loans in that, instead of receiving a lump sum of cash, borrowers have an agreed-upon amount that they can take from their equity, and access as needed over time. There are two categories: a federal Direct Consolidation Loan and private consolidation or refinancing options.

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For individuals with debt on several credit cards, it can make sense to transfer the balances over to the card with the lowest interest rate, creating one payment and lowering interest overall.Above all, the approach has to match the need and the comfort level of the borrower.Some people prefer a DIY debt management plan, while others benefit from simplified singular payment of a consolidation loan.That makes sense for a lot of people.” She added: “But some people would rather tackle a debt management plan themselves.

If you know that wouldn’t be overwhelming to you, that makes a lot of sense.Enter your current debts into our loan calculator to start creating a plan to eliminate your debt.