Debt Consolidation

consolidating all personal and credit card debt under one loan

The debt consolidation option involves getting a loan to pay off and consolidate your debt under one, low repayment plan. Use this option if you have sufficient debt that will take more than 3-5 years to pay off.

Below are four (4) quick summary features of home equity lines:

Page Topics:

debt consolidation option

Is This Option Right For You

This may be an ideal option if your total credit card and personal loan debt is significant and if you need a consolidation program with payoff terms of 3 years or more.

Is this the right option for you:
this may be an ideal option if you can consolidate your loans under a repayment plan that offers an interest rate that is lower than the weighted interest rate charges on your existing loans.

You should consolidate only those loans under a repayment plan that offers an interest rate that is lower than the weighted interest rate charges on your existing loans.

This gives you the benefit of paying off loans without paying too much interest.

debt consolidation option

Estimate Weighted Interest Rate

debt consolidation option

Estimate Amount to Consolidate

Use the Debt Consolidation Worksheet below and list each credit card and loan balance that has a debt balance. Insert the balance amount with its respective interest rate (APR).

Hit "Calculate" to total your numbers.
(of if you like, download our debt relief worksheet)

Set repayment plan:

Note that your "loan repayment terms" can be anywhere from 5- to 7-to 10-years or more. Calculate your estimated monthly payment; note the monthly savings you can anticipate by consolidating your debt under extended repayment terms.

Run different repayment scenarios to design a payoff plan that works for you.

debt consolidation option

Debt Consolidation Worksheet

Credit Card 1 $ %
Credit Card 2 $ %
Credit Card 3 $ %
Auto Loan 1 $ %
Auto Loan 2 $ %
Boat/RV Loan $ %
Education Loans $ %
Personal Loans $ %
Other Loans $ %
Enter your loan
consolidation rate (APR):

%
Enter your loan repayment terms:
5yr=60 months, 10yr=120 months,
15yr=180, 20yr=240, 30yr=360
months
       *
Your total outstanding debt balance $
By consolidating and paying off your total debts within the time specified at the annual percentage rate shown, your potential monthly savings is shown  
Your current monthly payment if you
DID NOT consolidate
Your estimated monthly payment if you
DID consolidated
Potential average monthly savings by consolidating
Potential annual savings
 
* Calculations are based upon the assumptions you entered. Please note that rounding errors can make a small difference in calculations. Your actual mortgage lending rate may vary depending on your credit quality and lender. The circumstances surrounding your credit and loan qualifications may result in different calculations.

 

debt consolidation option

Use Savings To Pay Down

The advantage of consolidation is that you can extend the repayment period to reduce your monthly pay outs. The disadvantage is that over time, you will pay out more interest by extending your repayment plan.

However if your budget allows, you can use the monthly consolidation savings to payoff your consolidation loan faster.

For example:
let's assume that you had the following debts totaling $32,304 with a monthly payment $767. Under this current repayment plan, it will take you 5 years to payoff (60 months)

If you consolidated the following loans below under a consolidation rate of 7.00% with a 10-year repayment plan, you would save around $392 each month over current payments.

These savings can be applied as an extra amount each month to pay down your consolidation loan within 4 years — 1 year earlier if you didn't consolidate your debts. This only works if the consolidation loan is less than the weighted average of all debts being consolidated.

Current Outstanding Loans

  Balance Payment Rate
Debt1 $800 $32 12.5%
Debt2 $1200 $40 12.5%
Debt3 $2777 $67 12.5%
Debt4 $8530 $175 8.00%
Debt5 $18997 $453 6.75%
Total $32,304 $767  
Payoff 60 months

Consolidation Loan: 10-Yr Repayment Plan

  Balance Payment Rate
Total $32,304 $375.08 7.00%
Savings   $392.00 ($767-$375)
Payoff Amounts
Current   $375.08 (payment)
Extra1   $392.00 (savings)
Total   $767.08 (total payment)
Payoff around 48 months


debt consolidation option

Consolidation Options

If You Own a Home:

By using the security of your home, you can secure a home equity or home refinancing loan at low rates with repayment terms of 5 or more years. You can use this loan to consolidate your credit card and other loan debt.

This option allows you to setup a repayment plan with extended terms that can significantly reduce your monthly payment (depending on the amount being consolidated).

You can also pay extra each month to quickly payoff your consolidation loan.

Get up to four national lenders to review a consolidation option that fits your budget. Select the option that works for you. No obligation.

no obligation debt consolidation loan

For those who don't own a home:

This deb reduction option is available for debt holders who don't have a home or who don't have enough equity in their home to consolidate. Debt professionals will tailor a debt reduction plan that works for you.

This option allows you to setup a repayment plan with extended terms that can significantly reduce your monthly payment (depending on the amount being consolidated).

no obligation debt reduction request form

Navigate: home  >  financing guides  >  debt relief  >  debt consolidation