Debt Consolidation Loans Explained: 6 Things You Need to Know

Debt is a problem for many Americans. Especially now in the holiday season. So, what will you do when the holidays are over, and your credit card debt is piling up?

Debt consolidation loans are a great way to combine your debt into one monthly payment, with less interest than you were paying on each credit card.

Debt Consolidation loans allow you to put most or all of your debt onto one line of credit, or loan, to reduce interest and monthly payments.

What Kinds Of Debt Consolidation Loans Are Available? -Refinance or Home Equity Line of Credit (HELOC) -Balance Transfers -Personal Loan

How Can A Refinance Or HELOC Help You? If you are a homeowner and your mortgage is in good standing, you can use the equity you have in your home to cover a debt consolidation loan.

What Is A Refinance? Completing a refinance on your mortgage means you are taking out a new loan through a mortgage company and applying it to the old one to pay it off.

What Is A HELOC? If you don’t want to go through a refinance process, this is a good option because you will still pay less interest than you pay on your other lines of credit combined.

A balance transfer is an opportunity provided by credit card companies. A balance transfer is an excellent option for a debt consolidation loan if you have high-interest revolving debt.

How Can A Personal Loan Help You? These loans are helpful because there are options from online lenders that are willing to work with you even if you have a lot of debt to consolidate.

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