26:["$","$L27",null,{"category":"$28","relatedArticles":[{"id":"cG9zdDozNTMwMw==","databaseId":35303,"postId":35303,"author":{"node":{"id":"dXNlcjo1MA==","databaseId":50,"userId":50,"avatar":{"url":"https://secure.gravatar.com/avatar/10ca58872f36412ceff58616bb971c22?s=96&d=mm&r=g","size":96,"__typename":"Avatar"},"description":"Amelia Josephson is a writer passionate about covering financial literacy topics. Her areas of expertise include retirement and home buying. Amelia's work has appeared across the web, including on AOL, CBS News and The Simple Dollar. She holds degrees from Columbia and Oxford. Originally from Alaska, Amelia now calls Brooklyn home.","additionalMeta":{"expertise":null,"__typename":"User_Additionalmeta"},"email":null,"firstName":"Amelia","fullName":"Amelia Josephson","lastName":"Josephson","name":"Amelia Josephson","postCount":{"pageInfo":{"offsetPagination":{"total":334,"__typename":"OffsetPaginationPageInfo"},"__typename":"UserToPostConnectionPageInfo"},"__typename":"UserToPostConnection"},"slug":"ajosephson","__typename":"User"},"__typename":"NodeWithAuthorToUserConnectionEdge"},"categories":{"nodes":[{"id":"dGVybTo1NDM3","children":{"nodes":[],"__typename":"CategoryToCategoryConnection"},"databaseId":5437,"categoryId":5437,"link":"https://smartasset.com/personal-loans/articles","name":"Personal Loans","postCount":{"pageInfo":{"offsetPagination":{"total":26,"__typename":"OffsetPaginationPageInfo"},"__typename":"CategoryToPostConnectionPageInfo"},"__typename":"CategoryToPostConnection"},"slug":"personal-loans","ancestors":null,"parent":null,"__typename":"Category"}],"__typename":"PostToCategoryConnection"},"content":"$29","date":"2015-07-08T14:30:16","excerpt":"

\n","featuredImage":{"id":"cG9zdDoxOTE1Nzg=","databaseId":191578,"altText":"10 Largest Debt Consolidation Companies","date":"2023-03-19T02:06:53","fileSize":103528,"mimeType":"image/jpeg","modified":"2023-03-19T02:06:53","sourceUrl":"https://smartasset.com/wp-content/uploads/sites/2/2015/07/10-largest-debt-consolidation-companies.jpg","__typename":"MediaItem"},"modified":{"datetime":"2023-7-31","readable":"July 31, 2023"},"multipleBylinesByRole":{"editedBy":null,"reviewedBy":null,"writtenBy":null,"factCheckedBy":null,"secondEditor":null,"hideAuthor":null,"__typename":"Post_Multiplebylinesbyrole"},"adTargetingOverrides":{"fieldGroupName":"adTargetingOverrides","pageGroupNewKey":null,"__typename":"Post_Adtargetingoverrides"},"seo":{"canonical":"https://smartasset.com/personal-loans/the-10-largest-debt-consolidation-companies","metaDesc":"The 10 largest debt consolidation companies between them handle millions in American consumer debt. If your monthly payments on your debt are overwhelming,","metaKeywords":"","metaRobotsNofollow":"follow","metaRobotsNoindex":"index","readingTime":5,"title":"The 10 Largest Debt Consolidation Companies - SmartAsset","__typename":"PostTypeSEO"},"slug":"the-10-largest-debt-consolidation-companies","status":"publish","title":"The 10 Largest Debt Consolidation Companies","uri":"/personal-loans/the-10-largest-debt-consolidation-companies","tags":{"nodes":[],"__typename":"PostToTagConnection"},"__typename":"Post","adPageGroupOverride":null,"bylines":{"writtenBy":{"id":"dXNlcjo1MA==","databaseId":50,"userId":50,"avatar":"$2a","description":"Amelia Josephson is a writer passionate about covering financial literacy topics. Her areas of expertise include retirement and home buying. Amelia's work has appeared across the web, including on AOL, CBS News and The Simple Dollar. She holds degrees from Columbia and Oxford. Originally from Alaska, Amelia now calls Brooklyn home.","additionalMeta":"$2b","email":null,"firstName":"Amelia","fullName":"Amelia Josephson","lastName":"Josephson","name":"Amelia Josephson","postCount":"$2c","slug":"amelia-josephson","__typename":"User"},"editedBy":null,"reviewedBy":null,"factCheckedBy":null,"secondEditor":null},"category":{"id":"dGVybTo1NDM3","children":"$2f","databaseId":5437,"categoryId":5437,"link":"https://smartasset.com/personal-loans/articles","name":"Personal Loans","postCount":26,"slug":"personal-loans","ancestors":null,"parent":null,"__typename":"Category"},"isModifiedBeforePublished":false,"contentBlocks":["

Worried about your credit score? Debt got you down? Technically you don’t have to enlist the service of a debt relief, debt consolidation or debt settlement company. You can go to a non-profit credit counseling organization instead. If you’re willing to pay for help consolidating your debt, though, you should know the names on our list of the 10 biggest debt consolidation companies.

","

Before you commit to a debt management plan with a debt consolidation company, it’s a good idea to check to see whether the company you have in mind is registered with one of these three organizations:

","

Financial Counseling Association of America
Association of Credit Counseling Professionals
National Foundation for Credit Counseling

","

You can also check the Better Business Bureau for ratings and accreditation records of debt consolidation companies in your state. The 10 debt consolidation companies on this list are all BBB accredited. They’re also all accredited members of the American Fair Credit Council, a trade organization for the debt settlement industry that applies its own set of standards and practices to the accreditation process.

","

1. Clear One Advantage

","

Clear One Advantage is a debt relief company based in Baltimore, Maryland. They offer free debt analysis and no upfront fees on debt management plans. They work with unsecured debt like credit card debt and medical bills and offer a 100% service guarantee.

","

2. Freedom Debt Relief

","

Freedom Debt Relief is based in San Mateo, California. Founded in 2002, the company helps clients enroll in debt management programs. The service is not available in all states and fees may vary from state to state. Their process starts with an assessment of your debt. Then, they get you saving and negotiate with your creditors on your behalf.

","

3. National Debt Relief

","

National Debt Relief offers free debt relief quotes to folks who have more debt than they can manage themselves. Based in New York, they work to reduce the balances owed on credit card debt, medical bills, certain business debts, repossessions and other unsecured debt. Their focus is on helping clients avoid having to declare bankruptcy.

","

4. Pacific Debt, Inc.

","

","

Pacific Debt, Inc. is based in San Diego. They work with you to develop a debt relief program that leaves you with a single monthly payment appropriate for your budget. They offer a free, no-obligation consultation to potential clients. Plus, they’ll work with you to develop strategies to change your spending habits so you don’t fall back into debt.

","

5. Accredited Debt Relief

","

Accredited Debt Relief is another San Diego company offering debt management programs with no up-front fees. They offer free consultations and advise clients that it can take 24-48 months before debts are fully resolved. Accredited Debt Relief touts its team of negotiators and their ability to lower clients’ debt obligations.

","

6. Brite Solutions, Inc.

","

","

After an initial, free debt consultation, Brite Solutions, Inc. works with clients to negotiate and reduce debt obligations. Formed in 2008, they also offer an educational book on becoming debt free. They call their debt-resolution programs “performance-based.”

","

7. DebtHelp, Inc.

","

DebtHelp, Inc. has been around since 2006, helping consumers and businesses manage and pay off their debt. Their clients have brought over $341 million in debt to be managed and consolidated through customized debt management programs.

","

8. New Leaf Financial

","

New Leaf Financial is a New York-based company that offers clients help turning over – you guessed it – a new leaf in their finances. They offer a free first appointment and focus on helping you eliminate debt so you can work on other financial priorities like saving for the future.

","

9. RescueOne Financial

","

RescueOne Financial offers debt resolution and debt management plans. They also offer loans up to $80,000. They work with clients to negotiate and resolve current debt, as well as to develop a plan for staying out of debt in the future.

","

10. Timberline Financial

","

Timberline Financial aims to reduce your monthly payments by as much as half. They’re a New York-based company that doesn’t collect fees until they’ve started delivering results for clients. They’ll work with you to develop a debt-repayment timeline based on how much you can afford to make in monthly payments.

","

The Takeaway

","

Looking forward to the day when you’re finally debt free? We don’t blame you. Being in debt isn’t just a drain on your finances, it’s an emotional drain as well. It makes you lose sleep and neglect other financial priorities like saving for a down payment on a home or preparing for your retirement. The good news is that you don’t have to tackle your debt alone if you don’t want to.

","

Update: To make sure you stay on track financially and don’t end up in debt, consider working with a financial advisor. A matching tool like SmartAsset’s SmartAdvisor can help you find a person to work with to meet your needs. First you’ll answer a series of questions about your situation and goals. Then the program will narrow down your options from thousands of advisors to up to three fiduciaries who suit your needs. You can then read their profiles to learn more about them, interview them on the phone or in person and choose who to work with in the future. This allows you to find a good fit while the program does much of the hard work for you.

","

Photo credit: ©iStock.com/maxsattana, ©iStock.com/elenaleonova, ©iStock.com/pawel.gaul

"],"experts":null,"link":"/personal-loans/the-10-largest-debt-consolidation-companies","published":{"datetime":"2015-7-8","readable":"July 8, 2015"},"shareInfo":{"title":"The 10 Largest Debt Consolidation Companies","origin":"/personal-loans/the-10-largest-debt-consolidation-companies"},"isNewsArticle":false},{"id":"cG9zdDo1MjE3Ng==","databaseId":52176,"postId":52176,"author":{"node":{"id":"dXNlcjo1Ng==","databaseId":56,"userId":56,"avatar":{"url":"https://secure.gravatar.com/avatar/6c6068badd7060d5891badc9eafc451d?s=96&d=mm&r=g","size":96,"__typename":"Avatar"},"description":"Sarah Fisher has been researching and writing about business and finance for years. She has worked for the Consumer Financial Protection Bureau and her work has appeared on Business Insider and Yahoo Finance. Sarah has a bachelor's degree from Georgetown University and is from New York City. When she isn't writing finance articles, she dabbles in animation and graphic design.","additionalMeta":{"expertise":null,"__typename":"User_Additionalmeta"},"email":null,"firstName":"Sarah","fullName":"Sarah Fisher","lastName":"Fisher","name":"Sarah Fisher","postCount":{"pageInfo":{"offsetPagination":{"total":92,"__typename":"OffsetPaginationPageInfo"},"__typename":"UserToPostConnectionPageInfo"},"__typename":"UserToPostConnection"},"slug":"sfisher","__typename":"User"},"__typename":"NodeWithAuthorToUserConnectionEdge"},"categories":{"nodes":[{"id":"dGVybTo1NDM3","children":{"nodes":[],"__typename":"CategoryToCategoryConnection"},"databaseId":5437,"categoryId":5437,"link":"https://smartasset.com/personal-loans/articles","name":"Personal Loans","postCount":{"pageInfo":{"offsetPagination":{"total":26,"__typename":"OffsetPaginationPageInfo"},"__typename":"CategoryToPostConnectionPageInfo"},"__typename":"CategoryToPostConnection"},"slug":"personal-loans","ancestors":null,"parent":null,"__typename":"Category"}],"__typename":"PostToCategoryConnection"},"content":"$31","date":"2016-08-25T10:00:07","excerpt":"

Co-signing your friend’s loan might seem like a nice thing to do. But it can put many things in your life at risk, including your finances, your credit score and even your friendship. While it’s possible to co-sign a friend’s loan and never face any negative consequences, it might not be worth it. Check out […]

\n","featuredImage":{"id":"cG9zdDo1MjYxNQ==","databaseId":52615,"altText":"Top 5 Reasons Why You Shouldn't Co-Sign a Friend's Loan","date":"2016-08-17T14:20:51","fileSize":26036,"mimeType":"image/jpeg","modified":"2016-08-17T14:20:51","sourceUrl":"https://smartasset.com/wp-content/uploads/sites/2/2016/08/iStock_91801935_SMALL.jpg","__typename":"MediaItem"},"modified":{"datetime":"2024-3-14","readable":"March 14, 2024"},"multipleBylinesByRole":{"editedBy":null,"reviewedBy":null,"writtenBy":null,"factCheckedBy":null,"secondEditor":null,"hideAuthor":null,"__typename":"Post_Multiplebylinesbyrole"},"adTargetingOverrides":{"fieldGroupName":"adTargetingOverrides","pageGroupNewKey":null,"__typename":"Post_Adtargetingoverrides"},"seo":{"canonical":"https://smartasset.com/personal-loans/why-you-shouldnt-co-sign-a-friends-loan","metaDesc":"Co-signing your friend's loan might seem like a nice thing to do. But it can put you in a difficult financial situation. Here's why you should avoid it.","metaKeywords":"","metaRobotsNofollow":"follow","metaRobotsNoindex":"index","readingTime":3,"title":"Why You Shouldn't Co-Sign a Friend's Loan","__typename":"PostTypeSEO"},"slug":"why-you-shouldnt-co-sign-a-friends-loan","status":"publish","title":"Why You Shouldn’t Co-Sign a Friend’s Loan","uri":"/personal-loans/why-you-shouldnt-co-sign-a-friends-loan","tags":{"nodes":[],"__typename":"PostToTagConnection"},"__typename":"Post","adPageGroupOverride":null,"bylines":{"writtenBy":{"id":"dXNlcjo1Ng==","databaseId":56,"userId":56,"avatar":"$32","description":"Sarah Fisher has been researching and writing about business and finance for years. She has worked for the Consumer Financial Protection Bureau and her work has appeared on Business Insider and Yahoo Finance. Sarah has a bachelor's degree from Georgetown University and is from New York City. When she isn't writing finance articles, she dabbles in animation and graphic design.","additionalMeta":"$33","email":null,"firstName":"Sarah","fullName":"Sarah Fisher","lastName":"Fisher","name":"Sarah Fisher","postCount":"$34","slug":"sarah-fisher","__typename":"User"},"editedBy":null,"reviewedBy":null,"factCheckedBy":null,"secondEditor":null},"category":{"id":"dGVybTo1NDM3","children":"$37","databaseId":5437,"categoryId":5437,"link":"https://smartasset.com/personal-loans/articles","name":"Personal Loans","postCount":26,"slug":"personal-loans","ancestors":null,"parent":null,"__typename":"Category"},"isModifiedBeforePublished":false,"contentBlocks":["

","

1. You’ll Be Responsible for the Loan

","

No matter how trustworthy or wonderful your friend may be, he might end up defaulting on the loan he took out. Anything could happen. Your friend could lose his job or find out that a relative needs help paying for medical treatment. If your friend can’t pay back the money he borrowed, you would have to pay for the loan if you co-signed it.

","

2. Your Credit Could Take a Hit
\n

","

","

If you co-sign a friend’s loan and he misses a single loan payment deadline, your credit score could drop. If that happens, it might be harder for you to buy a house or get a low-interest rate on a loan in the future. If your friend fails to pay back whatever he owes, the lender might sue you first. In the lender’s eyes, you are far more likely to pay back the loan since your credit score is probably higher.

","

3. Your Property May Be at Risk

","

Sometimes a co-signer will secure a loan with his or her own property. If you (the co-signer) put up your car or house as collateral and your friend doesn’t pay back the loan, you could potentially lose your property.

","

4. You Could Destroy Your Friendship
\n

","

If you’re forced to cover the cost of the loan you co-signed, you could end up resenting your friend. After all, it can be difficult to remain friends with someone who puts you in a complicated financial situation.

","

5. It Could Be Harder to Get a Loan Later On
\n

","

","

Co-signing your friend’s loan could make qualifying for another loan more difficult. For example, if you co-sign your friend’s car loan and then you try to take out a personal loan, a lender might reject your application. Co-signing your friend’s loan will affect your debt-to-income ratio (the amount of debt you’re paying off compared to your monthly gross income). A lender might not want to lend money to someone who already has a lot of debt to pay off.

","

Photo credit: ©iStock.com/BernardaSv, ©iStock.com/alexskopje, ©iStock.com/dolgachov

"],"experts":null,"link":"/personal-loans/why-you-shouldnt-co-sign-a-friends-loan","published":{"datetime":"2016-8-25","readable":"August 25, 2016"},"shareInfo":{"title":"Why You Shouldn’t Co-Sign a Friend’s Loan","origin":"/personal-loans/why-you-shouldnt-co-sign-a-friends-loan"},"isNewsArticle":false},{"id":"cG9zdDozMjUzMQ==","databaseId":32531,"postId":32531,"author":{"node":{"id":"dXNlcjo1Mw==","databaseId":53,"userId":53,"avatar":{"url":"https://secure.gravatar.com/avatar/e108c21a7f5933aad20a2fed390a87d8?s=96&d=mm&r=g","size":96,"__typename":"Avatar"},"description":"Amanda Dixon is a personal finance writer and editor with an expertise in taxes and banking. She studied journalism and sociology at the University of Georgia. Her work has been featured in Business Insider, AOL, Bankrate, The Huffington Post, Fox Business News, Mashable and CBS News. Born and raised in metro Atlanta, Amanda currently lives in Brooklyn.","additionalMeta":{"expertise":null,"__typename":"User_Additionalmeta"},"email":null,"firstName":"Amanda","fullName":"Amanda Dixon","lastName":"Dixon","name":"Amanda Dixon","postCount":{"pageInfo":{"offsetPagination":{"total":184,"__typename":"OffsetPaginationPageInfo"},"__typename":"UserToPostConnectionPageInfo"},"__typename":"UserToPostConnection"},"slug":"adixon","__typename":"User"},"__typename":"NodeWithAuthorToUserConnectionEdge"},"categories":{"nodes":[{"id":"dGVybTo1NDM3","children":{"nodes":[],"__typename":"CategoryToCategoryConnection"},"databaseId":5437,"categoryId":5437,"link":"https://smartasset.com/personal-loans/articles","name":"Personal Loans","postCount":{"pageInfo":{"offsetPagination":{"total":26,"__typename":"OffsetPaginationPageInfo"},"__typename":"CategoryToPostConnectionPageInfo"},"__typename":"CategoryToPostConnection"},"slug":"personal-loans","ancestors":null,"parent":null,"__typename":"Category"}],"__typename":"PostToCategoryConnection"},"content":"$39","date":"2015-07-02T12:30:28","excerpt":"

\n","featuredImage":{"id":"cG9zdDoxOTE1OTM=","databaseId":191593,"altText":"What Is Unsecured Debt?","date":"2023-03-19T02:07:13","fileSize":47835,"mimeType":"image/jpeg","modified":"2023-03-19T02:07:13","sourceUrl":"https://smartasset.com/wp-content/uploads/sites/2/2015/07/iStock_000014702174_Small.jpg","__typename":"MediaItem"},"modified":{"datetime":"2023-8-11","readable":"August 11, 2023"},"multipleBylinesByRole":{"editedBy":null,"reviewedBy":null,"writtenBy":null,"factCheckedBy":null,"secondEditor":null,"hideAuthor":null,"__typename":"Post_Multiplebylinesbyrole"},"adTargetingOverrides":{"fieldGroupName":"adTargetingOverrides","pageGroupNewKey":null,"__typename":"Post_Adtargetingoverrides"},"seo":{"canonical":"https://smartasset.com/personal-loans/what-is-unsecured-debt","metaDesc":"An unsecured debt is a loan that doesn't have collateral attached to it. That means that if you can't pay your bill, your lender can't take anything, but...","metaKeywords":"","metaRobotsNofollow":"follow","metaRobotsNoindex":"index","readingTime":5,"title":"What Is Unsecured Debt? - SmartAsset","__typename":"PostTypeSEO"},"slug":"what-is-unsecured-debt","status":"publish","title":"What Is Unsecured Debt?","uri":"/personal-loans/what-is-unsecured-debt","tags":{"nodes":[],"__typename":"PostToTagConnection"},"__typename":"Post","adPageGroupOverride":null,"bylines":{"writtenBy":{"id":"dXNlcjo1Mw==","databaseId":53,"userId":53,"avatar":"$3a","description":"Amanda Dixon is a personal finance writer and editor with an expertise in taxes and banking. She studied journalism and sociology at the University of Georgia. Her work has been featured in Business Insider, AOL, Bankrate, The Huffington Post, Fox Business News, Mashable and CBS News. Born and raised in metro Atlanta, Amanda currently lives in Brooklyn.","additionalMeta":"$3b","email":null,"firstName":"Amanda","fullName":"Amanda Dixon","lastName":"Dixon","name":"Amanda Dixon","postCount":"$3c","slug":"amanda-dixon","__typename":"User"},"editedBy":null,"reviewedBy":null,"factCheckedBy":null,"secondEditor":null},"category":{"id":"dGVybTo1NDM3","children":"$3f","databaseId":5437,"categoryId":5437,"link":"https://smartasset.com/personal-loans/articles","name":"Personal Loans","postCount":26,"slug":"personal-loans","ancestors":null,"parent":null,"__typename":"Category"},"isModifiedBeforePublished":false,"contentBlocks":["

Month after month, you may struggle to keep up with payments on all kinds of loans, from credit card debt to medical bills. Most forms of debt require you to pay back borrowed money with interest, but not all debt is the same. There are two major types of debt and it’s important to know the difference between them in order to successfully manage your debt in the long run.

","

Find out now: Which credit card is best for me?

","

Secured Debt

","

Before you can understand what unsecured debt is, it’s helpful to know about secured debt. With any secured debt, you’re borrowing money for an asset that has a lien placed on top of it. That asset becomes collateral for your loan. In other words, when you don’t pay the loan back on time, your lender can seize the asset.

","

Mortgages and car loans are two types of secured debts. If you have a mortgage, your home counts as an asset. Failing to make the monthly payments on your loan could end in your lender taking ownership of your house, leaving you literally without a roof over your head. And that won’t be the only thing you’ll have to worry about. Your credit score will likely drop as well.

","

Related Article: What Is a Secured Loan?

","

Unsecured Debt

","

Unsecured debt doesn’t come with any collateral. Credit cards are a popular kind of unsecured debt. Student loans and payday loans fall into this category as well. If you have a hard time making your credit card payments, your lender won’t have anything to confiscate. That’s why when it comes to debt, lenders generally prefer secured debts. If things go sour, at least they can walk away with something. On the other hand, because unsecured loans are riskier, lenders are typically able to charge higher interest rates. It can also be harder to qualify for an unsecured loan, especially if you have any credit issues.

","

In the event that an unsecured debt doesn’t get paid off, your lender can sue you and possibly even have your wages garnished, meaning that part of your paycheck will automatically go toward the debt you owe. Or your lender can find a debt collector who can keep after you until you cough up the extra cash.

","

Consolidating Your Unsecured Loans

","

Ideally you will pay back your debt in full and on time. But if you are having trouble keeping up with payments or are overwhelmed with multiple kinds of debt, there are some ways to make paying off your debt a bit more manageable.

","

With unsecured debt, you have the option of consolidating your loans, or putting them together. Instead of having to juggle a bunch of different loans, you’ll only have to make one payment and you can often lower your interest rate in the process. How easily you’ll be able to consolidate your loan will depend on your credit score.

","

If your credit is in pretty good shape and you’re trying to combine debt from different credit card accounts, you’ll likely be able to qualify for a personal unsecured debt consolidation loan from your bank, a credit union or another lender.

","

If you’re not interested in getting another loan, you could also apply for a credit card with a low or 0% interest rate and transfer balances from cards with higher interest rates and fees. With a lower-interest credit card, you could significantly reduce your monthly credit card bill. It’s important to check for and factor in any balance transfer fees you will have to pay.

","

What is the Best Method for Paying Off Debt?

","

If your credit score looks a little rough, it could be difficult to get an unsecured debt consolidation loan. Your best bet might be to seek out a non-profit debt management program that’s willing to work with you one-on-one to come up with a solution that’ll help you meet your financial goals.

","

Bottom Line

","

Not all loans are created equal. It’s important to prioritize and plan ahead to keep your debt from spinning out of control. Secured loans, like mortgages and auto loans, have collateral so they’re considered to be less risky in the eyes of lenders. But if you have a secured loan, you could eventually lose your home or car if you can’t pay your bills on time.

","

You might not physically lose as much with unsecured debt from credit cards and student loans, but it can be harder to make room for them in your budget since the interest rate for this type of loan is typically higher. Also, you could see a end up with debt collectors hounding you.

","

If you’re thinking about consolidating your unsecured debt or moving your balances to a lower-interest credit card, it’s a good idea to read the fine print to make sure you know whether your low interest rates will actually go up after a certain period of time. The more you know, the better decision you can make for your specific situation.

","

"],"experts":null,"link":"/personal-loans/what-is-unsecured-debt","published":{"datetime":"2015-7-2","readable":"July 2, 2015"},"shareInfo":{"title":"What Is Unsecured Debt?","origin":"/personal-loans/what-is-unsecured-debt"},"isNewsArticle":false},{"id":"cG9zdDoxMDc5NA==","databaseId":10794,"postId":10794,"author":{"node":{"id":"dXNlcjozMA==","databaseId":30,"userId":30,"avatar":{"url":"https://secure.gravatar.com/avatar/c635bed4d2f6fca23fcd982e85038290?s=96&d=mm&r=g","size":96,"__typename":"Avatar"},"description":"Hank Coleman is a finance writer, financial planner and self-proclaimed investing junkie. He has a Masters Degree in Finance and a Graduate Certificate in Financial Planning. Hank is an expert in all things retirement, investing and home buying. Be sure to follow him on Twitter @MoneyQandA and on his blog, Money Q&A.","additionalMeta":{"expertise":null,"__typename":"User_Additionalmeta"},"email":null,"firstName":"Hank","fullName":"Hank Coleman","lastName":"Coleman","name":"Hank Coleman","postCount":{"pageInfo":{"offsetPagination":{"total":6,"__typename":"OffsetPaginationPageInfo"},"__typename":"UserToPostConnectionPageInfo"},"__typename":"UserToPostConnection"},"slug":"hcoleman","__typename":"User"},"__typename":"NodeWithAuthorToUserConnectionEdge"},"categories":{"nodes":[{"id":"dGVybTo1NDM3","children":{"nodes":[],"__typename":"CategoryToCategoryConnection"},"databaseId":5437,"categoryId":5437,"link":"https://smartasset.com/personal-loans/articles","name":"Personal Loans","postCount":{"pageInfo":{"offsetPagination":{"total":26,"__typename":"OffsetPaginationPageInfo"},"__typename":"CategoryToPostConnectionPageInfo"},"__typename":"CategoryToPostConnection"},"slug":"personal-loans","ancestors":null,"parent":null,"__typename":"Category"}],"__typename":"PostToCategoryConnection"},"content":"$41","date":"2013-10-17T12:30:17","excerpt":"

There are very few times when taking out more debt to pay off credit card debt makes sense. Using a personal loan to pay off your credit card debt is only moving the money around. The debt is still there. …

\n","featuredImage":{"id":"cG9zdDoxNzg4NzA=","databaseId":178870,"altText":"When to Pay Off Credit Card Debt with a Personal Loan","date":"2022-11-18T02:02:35","fileSize":45860,"mimeType":"image/jpeg","modified":"2022-11-18T02:02:35","sourceUrl":"https://smartasset.com/wp-content/uploads/sites/2/2013/10/CC-2-1.jpg","__typename":"MediaItem"},"modified":{"datetime":"2022-11-18","readable":"November 18, 2022"},"multipleBylinesByRole":{"editedBy":null,"reviewedBy":null,"writtenBy":null,"factCheckedBy":null,"secondEditor":null,"hideAuthor":null,"__typename":"Post_Multiplebylinesbyrole"},"adTargetingOverrides":{"fieldGroupName":"adTargetingOverrides","pageGroupNewKey":null,"__typename":"Post_Adtargetingoverrides"},"seo":{"canonical":"https://smartasset.com/personal-loans/when-to-pay-off-credit-card-debt-with-a-personal-loan","metaDesc":"There are very few instances when it makes sense to pay off credit card debt by taking out a personal loan. SmartAsset helps you know if it's right for you.","metaKeywords":"","metaRobotsNofollow":"follow","metaRobotsNoindex":"index","readingTime":4,"title":"When to Pay Off Credit Card Debt with a Personal Loan | SmartAsset","__typename":"PostTypeSEO"},"slug":"when-to-pay-off-credit-card-debt-with-a-personal-loan","status":"publish","title":"When to Pay Off Credit Card Debt with a Personal Loan","uri":"/personal-loans/when-to-pay-off-credit-card-debt-with-a-personal-loan","tags":{"nodes":[],"__typename":"PostToTagConnection"},"__typename":"Post","adPageGroupOverride":null,"bylines":{"writtenBy":{"id":"dXNlcjozMA==","databaseId":30,"userId":30,"avatar":"$42","description":"Hank Coleman is a finance writer, financial planner and self-proclaimed investing junkie. He has a Masters Degree in Finance and a Graduate Certificate in Financial Planning. Hank is an expert in all things retirement, investing and home buying. Be sure to follow him on Twitter @MoneyQandA and on his blog, Money Q&A.","additionalMeta":"$43","email":null,"firstName":"Hank","fullName":"Hank Coleman","lastName":"Coleman","name":"Hank Coleman","postCount":"$44","slug":"hank-coleman","__typename":"User"},"editedBy":null,"reviewedBy":null,"factCheckedBy":null,"secondEditor":null},"category":{"id":"dGVybTo1NDM3","children":"$47","databaseId":5437,"categoryId":5437,"link":"https://smartasset.com/personal-loans/articles","name":"Personal Loans","postCount":26,"slug":"personal-loans","ancestors":null,"parent":null,"__typename":"Category"},"isModifiedBeforePublished":false,"contentBlocks":["$49","

1. To Lower Your Interest Rates

","

The most important aspect of a debt consolidation loan is to lower the annual interest rate of your debts. Often, a personal loan can be the perfect instrument for you to lower the annual interest rates of your debt. You should not consider a personal loan to consolidate your credit card debts if it does not lower the annual interest rate you are already paying. Paying a lower interest rate will allow you to pay off more principal each month, help you get out of debt faster, and lower the total cost of your debt.

","

2. To Consolidate Payments Into One

","

","

Consolidating several credit card payments into one personal loan is a great achievement. Having one loan payment allows you to focus all of your time, attention, and energy into that one payment. It is much easier to concentrate on and pay off one debt instead of having several smaller debts that always seem to nip at your heels.

","

Of course, you must also strive to not rack up your credit card balances after consolidating your credit card debt with a personal loan. It will not do you much good to focus on one large debt if you begin accumulating smaller balances again on your credit cards. You have to avoid playing a shell game with your debts, and you will need to address the underlying, fundamental reason why you are in debt. Do you have a spending problem? Do you not stick to your family’s monthly budget? You have to address these issues in order to get out of debt and stay out of debt.

","

3. To Lower Your Monthly Payments

","

Using a personal loan to consolidate your debts can also lower your total monthly payments for the debts that you owe. You will have to run the numbers, but often you will find that your monthly minimum payment for your one personal loan that consolidated your debt is lower than the total of all your separate credit card minimum monthly payments.

","

Lowering your monthly payments can help you create a debt snowball and assist you in paying off your credit card and now personal loan debt faster. For example, if you were originally paying $500 per month in minimum payments to the credit card companies and now found yourself paying only $400 per month on your new personal loan, you can afford to apply the other $100 per month directly to your loan’s principal. This strategy will help you get out of debt faster.

","

The Bottom Line

","

If you are not saving money by restructuring your credit card debts using a personal loan, either by cutting down your monthly payments or lowering your interest rates, it is probably not a good idea to restructure your debt. Make moving your debt around worthwhile to you. Insist on a lower interest rate for your debt, lower your monthly payment so you can pay off your debt faster and take back control over your finances with one lower monthly payment.

","

Credit Card Tips

","$4a","

"],"experts":null,"link":"/personal-loans/when-to-pay-off-credit-card-debt-with-a-personal-loan","published":{"datetime":"2013-10-17","readable":"October 17, 2013"},"shareInfo":{"title":"When to Pay Off Credit Card Debt with a Personal Loan","origin":"/personal-loans/when-to-pay-off-credit-card-debt-with-a-personal-loan"},"isNewsArticle":false}]}]