I have the opportunity to get a $10,000 consolidation loan to pay off all my cards ($6,000) but I'm not sure that's a good idea. I would like to raise my credit score to make a major purchase.
2006-09-17 11:21:49 · 13 answers · asked by Anonymous in Business & Finance ➔ Credit
First and foremost, and I wish someone would have told you this a long time ago, never let your credit card debts get above half what you make in a month. If you have to let it get beyond half your monthly salary ask yourself if you really need it. If not then don't get it. I keep my debts below $600 at all times.
But since no one helped on this before it was too late then this is what I suggest. Do not get the loan...this will put you in debt all over again. You'll still owe the $6,000 but with lower payments through the loan it will take you longer to pay off. Instead...take the minimum due per month and multiply that by 2...this is your new payment. You will pay it off faster.OR...automatically give up half your paycheck. It's a sacrifice but you must get this paid off. Talk to someone about budgeting your money. There is software out there to help you with this.
And lastly...this major purchase you're itchin to have...is it something you want or is it a need? If it's a want I say banish the thought from your mind. If you need it get a loan from the bank for ONLY that purchase amount.
2006-09-17 11:31:28 · answer #1 · answered by Lady_D 3 · 0⤊ 0⤋
The loan is a better way to go as long as you don't start charging on your cards again. If you do that then you will have the loan to pay off and the cards both.
Good Luck!
2006-09-17 11:29:19 · answer #2 · answered by sclay95843 4 · 0⤊ 0⤋
The consoladation loan is best, if you get rid of all of your credit cards and promise never to use them again.
Then take the extra 4K and pay down the consolodation loan
This is assuming that the loan has good rates.
2006-09-17 11:31:05 · answer #3 · answered by starting over 6 · 0⤊ 0⤋
You have to make sure that the loan has a lower interest rate than your credit cards. If it doesn't then pay off your credit cards, starting with the one that has the highest percentage of interest (APR).
2006-09-17 16:06:26 · answer #4 · answered by Steve R 6 · 0⤊ 0⤋
If you can get the loan at a good rate and cut up those cards so you stop using them,that's the way to go!
2006-09-17 11:23:43 · answer #5 · answered by Anonymous · 0⤊ 0⤋
get a consolidation loan and pay off everything at once
2006-09-17 11:28:49 · answer #6 · answered by Anonymous · 0⤊ 0⤋
The less credit out the better. Which has the lowest precentage? That's the way to go... but make sure you read all the fine print with both options.
2006-09-17 11:30:22 · answer #7 · answered by pyxypower777 2 · 0⤊ 0⤋
It all depends. I think the best way to make a decision is to educate yourself and get familiar with all the possible scenario. Two articles in my resource box might be helpful. Check it out and good luck!
2006-09-18 19:32:06 · answer #8 · answered by Anonymous · 0⤊ 0⤋
pay them off take the loan
2006-09-17 11:24:35 · answer #9 · answered by yarddogbiscut 2 · 0⤊ 0⤋
The longer you take, the more interest the bank makes. So do the math. My bank charges over 20% interest....
2006-09-17 11:33:13 · answer #10 · answered by Vinegar Taster 7 · 0⤊ 0⤋