When it comes to managing debt, there are several options that do not involve settling with your credit card company. Learn about some of these options below to start figuring out if they might be right for you. You may consider trying these options before hurting your credit with a settlement.
Personal Loan – If you have good to fair credit, you may be able to pay off all your debt with a personal loan. Credit cards have high-interest rates, and loans are often half or less than the typical credit card rate.
Likewise, paying off several creditors with a loan means you will reduce your number of monthly payments. Instead of paying three or four lenders, you will just have a single payment for the loan.
Debt Consolidation – Like a personal loan, you can pay all of your debt off with consolidation. Your debt settlement program will likely have a lower rate than most of your credit cards. Where credit cards could be in the 20s and 30s, loans can be in the single digits.
Consolidating all your debt to one lender will also reduce the number of monthly payments.
Instead of making payments for student loans, car loans, and two or three credit card companies, you will just make payments for the consolidated debt.
Balance-Transfer Credit Card – Credit card offers can save you from your past credit card debt. Cards companies often offer zero percent interest for a period, such as 18 to 24 months. After that, the rate starts, but you will have more time to pay off your debt without getting interest fees.
Bankruptcy – Can you file bankruptcy for credit card debt? Yes, you can, but it should be one of your last options.
Before picking one of these options, make sure not to miss these tips on debt-reduction companies.
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