When you are in debt, you most likely are looking for avenues to help you become debt-free faster and easier. Debt consolidation may be one of those options you want to consider. To help you feel more confident in the process, here are the steps you could take to decide if debt consolidation is right for you.
1. Make a List of Your Debts
What are the debts you currently pay each month? Perhaps student loans, credit card debt, or unexpected medical expenses? Take the time to write them down to help review your various payments.
2. Outline the Amounts Paid and Owed
Once you’ve made a list of all the debts that you owe, the next step would be to write down the total amount owed for each debt, the monthly payment due, and the interest rate paid.
3. Add Up Your Debts
After you write down all the numbers, add up the total amount owed on all debts and put that in one column. This number tells you how much you will need to borrow for a debt consolidation loan.
4. Add Up Monthly Payments
What are your monthly payments for each one of your debts? Write that number down in another column. This total helps you with a comparison of the monthly amount owed and the monthly payment amount that would be paid with a debt consolidation loan.
5. Visit Your Financial Institution
After calculating these numbers, you would then visit your local credit union or financial institution to get information about a debt consolidation loan (or a personal loan depending on the institution). Find out if you can get a loan that will cover the total amount owed, how much the monthly payment will be, and what the interest rate charges will be.
6. Make a Decision
Once you’ve gathered all the information, do a comparison between what you currently pay each month and what you would pay with a debt consolidation loan. If the debt consolidation loan will be beneficial, then it might be wise to choose this option and follow through with your credit union or other financial institution.
Do you need help making a decision? Let us know!
As we begin the New Year, it’s a great time to work on lowering your monthly payments. We offer ways to consolidate your debt into one possibly lower monthly payment. Please give us a call at 800-835-3400 to speak with one of our Member Advisors, or visit us online at caminofcu.org for more information.