You are not alone if you are in so much debt that it is causing you problems. Even if more and more consumers are making their most payments, their outstanding balances either remain the same or go up. And this comes after they pay more than the bare least. They are, in a word, in trouble. It only makes sense that you would want to learn how to merge debt in a way that allows you to make smaller monthly payments, pay off your debt faster, and doesn’t harm your credit score.

Although loans for consolidating debt are the most popular option, there isn’t a single best way to do so. There are actually a few options to pick from. The fact that there are other options does not make loans a terrible option.
People consider debt consolidation loans first, but there are other options as well. For instance, working with an approved credit counseling agency is a good way to combine all your loans and have a lower monthly payment. Such agencies can negotiate with most creditors to give you better terms, keep your credit score about where it is, and prevent you from having to take out an extra loan.

Transferring high-rate credit card balances to lower-rate cards is one of the other more popular methods that consumers consider when considering how to merge debt. This seems like a nice concept on the surface. But, you must exercise extreme caution because the terms for balance transfers vary depending on the credit card company. Although the first rate may be favorable, it might only be short-lived, and when it changes, it might be more expensive than the current rate. You can transfer as much as you want with certain businesses, but the best rate is only applied to the first few thousand dollars. A balance transfer fee is another thing to be on the lookout for. Beware of the fine print, warns Walins, which sums it up.

If none of the other options work for you and you realize you need to take out a debt consolidation loan, see if you can receive a secured loan. The home equity loan is the most popular type. The benefit of doing it this way is that you will receive a cheaper interest rate than you would with other loans because the lender is taking a smaller risk because they have collateral in the form of your home. Of course, this isn’t always the case, so it’s up to you to test the rates, conditions, and costs of several loans before determining which one is the most effective for debt consolidation in your particular circumstance.