Starting to feel a little pressure because of your debt? You might think about consolidating that debt into one loan—but how to do it? Here are 4 options that many people consider:
- Transfer the balances to a credit card. For some people, that’s dangerous, because that’s how they got in debt trouble to begin with. If it seems right for you, be sure to ask about balance transfer fees on the new card so you’ll know what the transfer will cost you, as well as what the interest rate will be after any promotional period is over. Direct Federal offers a no fee, 0% for 6 months Visa balance transfer offer. After the 6 month promotional period, you pay just 5.75% APR* (Prime +1.75%) for the life of the balance. Click here for more information.
- Take out a home equity loan or line of credit. A home equity loan is typically for a fixed amount, while a line of credit is more like a credit card because you can use as much or as little of your credit limit as you’d like. Interest is usually tax deductible, and rates are low. Direct Federal offers a low rate home equity line—one of the best rates in Massachusetts. Click here to learn more.
- Use a personal loan. It’s not secured so you’re not risking your home, but you often need good credit to qualify. Click here to learn more about Direct Federal personal loans that will put cash in your hand quickly.
- Borrow against your 401(k) or IRA. Remember this: If you borrow from your 401(k) and you get fired, you have to pay it all back right away. And you’ll be losing any growth you would have earned on those accounts while the money is out of them. Talk to Direct Federal today about ways to consolidate debt without having to borrow against your retirement savings.
We encourage you to call us, or your local financial institution, and ask questions so you make the right choice for you, and you get that fresh start you’ve been dreaming of.