Is is a great idea to consolidate a college loan, car, and credit cards payments?

Question

I just got my self into a pot hole literally I need some advice is it ok to consolidate all these things together. I know I'm making only one payment a month? Will this take longer?pleassssssssssssssse........................help !

Answer 1

don't ever consolidate student loans because then you can never get them deferred or forgiven. (or deduct the interest) as for the car and CC loans, consolidate them individually to the lowest rate you can, so if you go into default on the CC, they are less likely to repo the car. (depending on the state) don't ever take out a home equity line of credit (if you own a home) to pay them, because if you default on that, they can take your house. (they cant if you default on the car or cc, student loans)

Answer 2

Bringing it all into a single payment is not really solving anything. It just simplifies your life, but sometimes does it at a cost.

First, your education loans should be kept separate, because they can be delayed payment. There's no reason to lump them in with other loans, because they enjoy a special status. (On the downside, you can't include them in a bankruptcy filing, but we're still hoping you won't have to do anything that drastic).

Secondly, it is the interest rates you should be focused on, not the monthly payments. If you have higher interest, then it might be wise to refinance them (consolidate them), but if they have a lower interest rate, then you should probably avoid refinancing. Car payments, for example, often have lower interest rates, and credit cards sometimes do, also. Thus, all of this should be done selectively.

Making one big payment a month won't help you any more than making a bunch of small payments. It sounds like your problem is more a result of not being able to manage your money, rather than owing too much. You should probably sit down with a professional credit counselor (or just a helpful friend) and figure out a payment plan that doesn't involve radical steps like consolidation.

In my experience, people who consolidate their debt without addressing the root problem end up getting back into as much debt as they previously had on credit cards, etc, and STILL have the consolidation loan TOO. Now, THAT's a real problem!!!

Answer 3

It depends on the current rates of interest you are paying on each debt individually. You will also need to take into consideration any fees you may incur as part of the consolidation. If you can get a lower interest rate, I would possibly consolidate the credit card payments. Typically you will pay higher interest rate to refinance a car loan, and student loans typically do not have large interest rates either. If you consolidate your credit card payments, make sure that you severely restrict or eliminate your credit card usage. If you do not, more than likely you will incur brand-new debt to go along with your consolidated debt.

It will also be worth your while to sit down and examine your monthly expenses versus your monthly income. There may be some gains you can make in this area in order to rid yourself of debt more immediately.