Can't Get A Debt Consolidation Loan? Try This Instead

Word Count:
469

Summary:
Despite the popularity of debt consolidation loans, they aren’t always the best option for people who are in debt. Also, if you’re in debt, it isn’t always very easy to get a debt consolidation loan. Not as easy as it is sometimes made out to be, anyway.

Why? Because if you’re in debt, then I’m guessing you’ve already missed a few payments, right? Well this means your credit rating has already taken a few knocks, which will make it harder to get that debt consolidation loa...


Keywords:
debt consolidation


Article Body:
Despite the popularity of debt consolidation loans, they aren’t always the best option for people who are in debt. Also, if you’re in debt, it isn’t always very easy to get a debt consolidation loan. Not as easy as it is sometimes made out to be, anyway.

Why? Because if you’re in debt, then I’m guessing you’ve already missed a few payments, right? Well this means your credit rating has already taken a few knocks, which will make it harder to get that debt consolidation loan.

But you have other options that don’t involve taking out a debt consolidation loan. And that is what I want to talk about today.

One option that you have is to get yourself a personal loan. Now I know that this won’t help much if you’re credit rating is damaged. But if it isn’t too bad, then you may be able to get an unsecured loan to help pay off your debt.

If you can get the loan from a credit union, you may be able to save some interest. But even if you get the loan from a bank, you’re going to be saving a lot of interest compared to what you’re probably paying your credit card companies.

If you’re debt mainly consists of credit cards (like most people, so don’t feel alone) then an option that may be worth trying is to call your credit card company and see if you can talk your way into better terms. You may have some success with this, so it’s worth giving it a shot. The person you’re talking to will usually have permission to reduce rates, too. So give it a try.

Another option that may help you if you’re a home owner is to get a home equity loan. These are usually quite low in interest rate, so you’ll be saving more of the interest that you would otherwise be giving to your credit card company. Also, what you may not realise is that the interest you pay in a home equity loan is tax-deductible (unlike credit card interest).

The final option I’d like to give to home owners, is to refinance your home for more than you owe. This means you will get some cash out to pay off your remaining debt. This is a good option for some people, as it gives you a nice low interest rate… but your payments are now going to be longer, 15 years is usually the minimum, going all the way up to 30.

Bear in mind that the interest over this amount of time can get very large, so this isn’t the best option over all, but it is an option if all else fails.