How To Consolidate Debt

Many people want to know how to consolidate debt. In other words, how can they combine multiple debts so they’re only making one payment? This is something that people desire because it lowers their interest rate and makes the repayment of outstanding debt more manageable. Fortunately, there are numerous ways in which you can do this.

Take out a Personal Loan

A personal loan is an unsecured loan that you can use for various things such as debt consolidation. If you qualify for a low annual percentage rate on one of these loans, then it’d be your best option. This is because you won’t need any collateral since your income and credit history are used as qualifying factors.

Transfer Your Debts Onto a Credit Card

For those who qualify, transferring your debt onto a credit card may be a good option. This is especially true if you happen to have multiple credit card balances from various companies. One of the nice things about taking this route is you’ll typically know within seconds if you qualify.

Take out a Debt Consolidation Loan, this is another type of unsecured loan. However, with this loan, you’re only allowed to combine your various debts together so you’re paying a single balance. You can usually get one of these loans through a major bank, credit union, or online lending firm.

Get a Home Equity Loan

As a homeowner, you’re allowed to borrow against your home’s equity by taking out a home equity loan (a.k.a. cash-out refinance). Fortunately, these loans typically allow you to borrow a lot of money at a low interest rate since they use your home as security. However, a lender will look at your credit and financial history to determine whether you qualify and if you do qualify, at what rate.

Borrow From a Life Insurance Policy

As the owner of a life insurance policy, you can use your policy’s cash value to reduce your debt. This can be done in a few different ways. One way to do this is by taking out a loan against your policy’s cash value. Another way is to cash out your life insurance policy which means that you terminate it in exchange for its cash value.

People who want to know how to consolidate debt when they have good credit and a steady income should know that there are many great options that’ll allow them to do this. These are just a few of the many options that are available for you to choose from. Hopefully, you’ll be able to take advantage of one of them so your finances will become more manageable for you.

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