For some people, juggling multiple payments with different creditors can be too much to manage.
Enter debt consolidation, a method of debt refinancing that involves taking out one new loan to pay off others.
But if your credit is in the fair to poor range, it may be a little trickier to consolidate your debts.
However, there are loans geared to people with less established credit or lower credit scores.
Some people use personal or debt consolidation loans to consolidate high-interest debt, such as credit card bills and payday loans.
Others consolidate their debt by transferring high-interest credit card balances to a card with a lower annual percentage rate (APR) or by taking out a home equity loan to pay off outstanding debt.
This will help you understand how much you need to borrow to consolidate your existing loans and give you an idea of the interest rate you need in order to save money moving forward.
Make sure you get the best loan possible when consolidating debt by following these tips: Since a debt consolidation loan is supposed to save you money, it's important to make sure your new interest rate is lower than your existing rates.
Review all your borrowing options before picking a debt consolidation loan, as some may offer better terms and benefits than others.
The information provided is for educational purposes only and should not be construed as financial advice.
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