Using a credit card is quick and easy, but sometimes that convenience comes at a price. Are you overwhelmed with monthly payments and rising rates? If you are concerned about your high interest-rate credit cards, a Carolinas Telco Federal Credit Union Personal Loan can help you consolidate existing debt into one fixed payment.
What is Debt Consolidation, and How Does it Work?
In debt consolidation, multiple debts are combined, usually at a lower interest rate or with one monthly payment.
In the second quarter of 2022, the average credit card Annual Percentage Rate (APR) was 16.65%[1]. Interest payments can comprise most of your monthly payments if you have multiple credit cards at around that rate. Instead, consider moving all your debt into one loan with a fixed rate which helps to protect you from rising Federal Reserve rates.
The Perks of Personal Loans for Debt Consolidation
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- A personal loan can be used for anything you choose!
- This type of loan provides the comfort of a fixed interest rate, often lower than variable-rate loans or credit cards.
- A fixed payment schedule makes budgeting easier. Having only one payment means you are more likely to pay on time and less likely to miss a payment.
- An unsecured personal loan gives you access to funds without collateral.
- A payment that doesn’t fluctuate can help you repay your debt quickly and effectively.
- Making consistent payments could improve your credit score by providing an opportunity to lower your credit utilization ratio.
How to Know if A Personal Loan for Consolidating Debt is Right for Me
Paying off that pesky debt with a personal loan can simplify your finances and give you the peace of mind of repaying on a set repayment schedule.
Want to discuss your options? We’re here to help! Since 1934, Carolinas Telco Federal Credit Union has been helping our members with their financial needs. Contact us today to discuss your options. Or, if you’re ready, apply for a Personal Loan.
[1] The Average Credit Card Interest Rate in 2022 (businessinsider.com)
