Monday, May 21, 2012

Three Effective Ways To Consolidate Credit Card Debt Without Using Intermediaries

Debt consolidation is getting increasingly popular among people with large credit card balances as it allows them to save money on interest and pay down their debts faster. Despite common opinion that only debt consolidation companies may help in dealing with your large credit card debt, it is not necessarily so. Debt consolidation is a task that may be performed all by yourself using three easy ways.

Balance Transfer

With increased competition in the credit card industry, more and more credit card companies offer low or no-interest balance transfer options. As such commonly require very good credit scores, they may be a perfect solution to borrowers with prime credit ranking, who are looking to consolidate their credit card debt. The key to saving money is finding a lender who offers the best terms. It is important to look objectively at your state of financing to see what offer may bring you most benefits. If you think you may be able to pay down your credit card balances within 12-18 months, you may consider a 0% APR offer for a limited time that some major banks offer recently. Otherwise, a low fixed rate credit card may be a better solution, as 0% APR often turns to a hefty interest rate after the promotional period ends.

Home Equity Loan

Unlike credit card balance transfer option, that is commonly available to people with high credit scores, home equity loans are within the reach of all credit grades. As these loans are secured by equity in your home, they are classified as low risk by lenders, bringing you the benefit of easy approval, low interest rate, and longer duration. You have to have some equity in your home, however, which may be a problem after the recent real estate market downturn. While home equity loans may be the most attractive option, they are unavailable to people who rent or who just purchased their residence and do not have sufficient equity.

Unsecured Personal Loan

Unsecured personal loans are a perfect solution to any borrowing needs. Lenders do not require you to state where the loan proceeds are going to be spent, and therefore may be utilized for almost every purpose. As lenders compete, such loans are widely available now to almost all credit grades and offer extremely attractive terms. With credit card rates on the rise, they may be a great solution to decrease the borrowing cost and pay off your debts sooner.

Go Online To Explore Your Options

Active online users are often able to find the best deals just because of their natural curiosity and ability to conduct a thorough research. Finance matters are important and costly, and therefore require a serious attitude. Do not spare your time looking for lenders online and comparing multiple debt consolidation options. Several hours spent on research may save you hundreds and even thousands of dollars every year in interest. Online loan brokers and lending platforms may be the best for impatient borrowers, as they offer a convenience of finding and comparing several lenders based on your individual parameters, as well as making one easy application leading to multiple debt consolidation offers.

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