Credit Card Debt Consolidation Loan: Is It Right For Your Situation?
A consolidation loan can be of tremendous help when it come to getting your unsecured credit card debt in control
. The credit card debt consolidation loan is but one of the of the most popular ways to help with paying off debt. Doing a balance transfer onto another lower rate card is the other.
Credit card companies would rather you complete a balance transfer onto another card instead of credit card debt consolidation loans. A lot of money is spent advertising the balance transfer route, but the consolidation loans are an important thing to consider as well.
So what do we mean by credit card debt consolidation loan?
Put simply, this loan is a low interest loan that you apply for with a bank or financial institution in order to clear off your high interest credit card debt. So credit card debt consolidation loan too is based on same principle as balance transfers i.e. moving from one or more high interest debts to a low interest one.
This type of consolidation loan is paid back in monthly installments like any of the other kinds of loans available.
A credit card debt consolidation loan is a type loan called an unsecured loan. But if your credit history is bad enough you may have to go with a secured loan. A secured loan is one in which you have to pledge some type of security or collateral in order to qualify for the loan.
The collateral or security to put down to insure the loan to you must be something as valuable as the loan your given. So if you have good credit you will have an easier time getting your consolidation loan.
Though balance transfers and credit card debt consolidation loans have the same objective behind them, the debt consolidation loans are sometimes considered better because you end up closing most of your credit card accounts which have been the main culprit in landing you in this difficult situation.
The choice you come to, either the balance transfer or the credit card debt consolidation loan, will be your choice because the balance transfer can some advantages the consolidation wont.
Credit Card Debt Consolidation Loan: Is It Right For Your Situation?