Let’s Review the Pros and Cons.
When you receive your first credit card, you may not know how easy it is to get over your head in debt. Though making small purchases may not appear to be a lot, these small amounts can add up very quickly. It is also important to note that getting out of this debt should not be taken lightly because it can destroy your credit. Fortunately, there is one smart way to pay off credit card debt quickly, and that is to secure a personal loan. Before you make this no debt credit decision, you should become familiar with both the pros and cons of using this kind of money management strategy.
In many cases, credit card companies charge high interest rates so it makes it very difficult to payoff credit card balances. Specifically, if you are only paying the minimum amount each month. To avoid this problem, securing a personal loan with a lower interest rate can help to pay the debt off. In fact, a personal loan has many different benefits including paying the total amount due in one single payment.
While a personal loan can be an ideal solution, there are some drawbacks too. Some of the most commonly known usually consists of the following:
– personal loans usually follow a slower monthly payoff time table
– credit card holder may only qualify for personal loans with the highest interest rates
– bad money management habits do not change, but continue to become worse.
Paying credit card debt with a personal loan can be a very smart way to eliminate this type of debt so that you can protect your credit. However, before you apply for a personal loan to payoff your debt, you will need to consider all of the benefits and the advantages. Typically, if the benefits outweigh the disadvantages, this is a great way to protect your credit.