The average household credit card debt is $10,000. With most
interest rates falling between 21 percent and 30 percent, it doesn’t take long
to do the math and figure out that too much of our money is going to pay off
high-interest credit cards.
Think about it this way. A credit card carrying a balance of $2,000 and an
interest rate of 29 percent would cost the cardholder almost $50 in interest per
month. That’s only $2,000 in credit card debt. How much do you have? For many
families, $2,000 is just a drop in the bucket of their high-interest, unsecured
debt. Does this sound like you?
If so, there is an easy solution to stop those expensive monthly interest
payments and lower your total monthly bills: debt consolidation. Consolidating
your debts brings all of your monthly bills into one loan that sports a low
interest rate. A lower interest rate alone could save you hundreds of dollars
each month, but a consolidation loan goes even one step further and lowers the
amount of your principle payments. That means that you could save hundreds of
dollars if not a $1,000 or more each month.
Most consolidation loans come in the form of a second mortgage. They lower your
bills by taking all of your smaller debts and lumping them together into one
loan. Your other creditors get paid off, and you only owe one sweet amount each
month to pay off your loan. The interest rates are almost always substantially
less than what you pay now, and your monthly payments can be reduced by hundreds
of dollars. Plus, more of your money goes toward the principle balance and that
means that you will be out of debt even sooner than planned.
And the process of consolidating your debts is as simple as the loan process
itself. Many companies will even send out your payoffs for you so the only thing
you have to worry about is the application process. With everything being this
simple, there is no reason not to lower your bills by consolidating your debts.
Just think of how much financial freedom you could achieve with a few extra
hundred dollars a month. Are you already thinking of how you could spend it?