Do you feel like you'll be making the same credit card payments for the rest of your life? If so, you're not alone. In fact, 38.1 percent of US households carry credit card debt that on average totals more than $15,000. The fact is, credit card debt can become a financial burden quickly. Many people struggle to keep up with the minimum monthly payments. Fortunately, there are things that you can do to regain control of your finances. Using an installment loan to consolidate your revolving debt has advantages. Discover how paying off your credit cards with an installment loan can benefit you.
One Monthly Payment
When you have multiple credit card bills, you're expected to pay the minimum payment on each credit card balance every month. This means you're trying to juggle several bills each month, which can be difficult to track. By using an installment loan to pay off the balance of your credit cards, you combine all of the payments into one preset monthly payment.
Lower Monthly Payment
While you may have credit cards that offer low introductory interest rates, the annual percentage rate for credit cards averages between 12.09 percent and 22.99 percent. Installment loans tend to have lower interest rates. People with good credit can find an unsecured installment loan with interest rates starting as low as 10 percent. If you have equity in your home or own your car completely, you should consider applying for a secure installment loan. Secured loans can have interest rates as low as two percent.
If your credit isn't perfect and you don't have a valuable asset to secure your loan with, you might find that getting a low interest rate isn't easy. Some installment loans carry interest rates as high as 36 percent, but you can shop around to find a loan that has a lower interest rate than your credit cards. Additionally, extending the amount of months you have to repay your loan can also lower your total monthly payment. So, if your goal is to lower your monthly payments and you can't find a loan with an interest rate that's lower than your credit cards, accepting a longer loan term could work well for you.
If you're struggling to pay off your credit card debt, don't let it discourage you. Instead, take some time to determine whether using an installment loan to consolidate your credit card debt is a good option for you. Contact a company like Las Vegas Finance for more info.