Consolidating Credit Card Debt with an Unsecured Personal Loan

Using Unsecured Personal Loans to Consolidate Credit Card Debt

You may be able to lower your total monthly debt expenses by paying off high-interest rate credit card balances with a fixed term and rate unsecured personal loan.  The interest rates on unsecured personal loans are typically lower than the interest rate on credit card debt, especially as credit card debt begins to build up.  Therefore taking out a personal loan to pay off all of your credit card at once can lower your interest rates, reduce your sources of debt, and actually improve your credit score over time.

Using a Loan for Bad Credit to Improve Your Credit Score

The opportunity to retake control of your finances without the added costs of a debt management company or attorney is best pursued before you experience financial difficulties that lead to late credit card payments.  Make sure you treat an unsecured personal loan responsibly.  Failure to pay off any form of loan results in credit score decreases, and it will become even more difficult to obtain financing.  Loans for bad credit are viable options for credit score improvement, as long as you don’t look at it like you’re out of debt when you take out that loan.  It’s just a better form of debt.

In addition to consolidating your debt, taking out an unsecured personal loan improves your mix of debt sources.  Showing lenders that you can responsibly borrow from a variety of sources is a great way to improve your credit score.  By taking out loans and using credit cards like you would cash, you’ll be well on your way to not only consolidating credit card debt, but actually improving your credit score.  A higher credit score mean you’ll have a better chance at getting loans, mortgages, and credit cards with great rates in the future.

Why Unsecured Loans?

Unsecured loans are often the best option if you have bad or no credit, because they offer the same general terms as a traditional secured loan, but without the need for collateral.  They make great loans for bad credit for that exact reason.  They typically don’t have as good of interest rates as secured loans, but you can get a loan online now with no credit check or collateral required. This makes unsecured personal loans a flexible, convenient option for people in need of debt consolidation or financing.  Secured loans often have lower rates, but they’re much harder, sometimes impossible, to get if you have bad or no credit.  Start with an unsecured personal loan to open the door to all other types of funding in the future!

Unsecured personal loans aren’t your only option for debt consolidation, but they are a viable and flexible one.  Don’t hesitate to start the process, it’s free and we don’t run a hard credit check (you check your credit score yourself). Even if you’ve got bad credit loans online are available to you- for debt consolidation, starting a business or anything you need.  The experts at Loans Now are here to help with all of your personal financing needs.