Do I want to Consolidate my Debt?

You may have heard suggestions that by consolidating you debt, you can pay off your obligations faster and with less fuss, but you are likely wondering if the fuss is worth it. The answer is only slightly complicated, and certainly depends on the person and his or her situation. It all depends on how you plan to consolidate your debt, the range of interest rates, and what is available to you.

I have several high interest credit cards
Is your credit good? If so, then you should look for a card promotion offering no interest on balance transfers. A high enough limit will allow you to put all of your eggs into one interest-free basket and help you to pay off your credit card debt even faster. To make sure that this works in your favor, call the company offering the card and let them know what you are doing. Ask them what kind of limit you might be accepted for, and make sure that they know that you are only interested in a card with a high enough limit to accommodate your transfers. You may get a great deal out of this!

My credit is terrible
Don’t worry – there are still things that you can do to consolidate your debt and reduce your payments. Talk to your bank about your financial needs. They may be able to help you out with the right loan to pay off your other debts and get things all settled into one account. And if your history with them is good, they might be able to overlook your credit a little.

My mortgage payments are killing me!
If your mortgage payments are just getting to be too much right now, then refinancing might be the way to go. Do not use this method if you cannot make your payments, however. This is a great way to get your payments down. Ask about an interest only loan, and make sure that there is no penalty for making more than the minimum payment if you so choose. Ask your mortgage company about taking your other debts onto your mortgage at the time, and possibly combining a first and second mortgage as well. You can get your payments to be about the same – but with a lack of other payments to worry about, you will still have more cash to spare.

I have lots of little debts scattered about
If you can make the payments on all of these without any trouble, then why are they scattered? Consolidating these debts might save you money in time and stamps alone! If you have lots of little credit card payments, maybe a tad left on your car loan, the financing of an appliance, or anything else, you may want to use a personal loan or a credit card to transfer the balances so that they are all in once place, easy to pay. This will greatly reduce the chances that you will ever miss a payment as well.