Pine Advisors is the newest website connected to Colony Associates, Alamo Associates and White Mountain Partners. The company has been aggressively marketing personal loan and debt consolidation loan offers to consumers across the United States. Pine advisors complaints are starting to pile up.
One of the most effective ways to pay off your debt is credit card consolidation loans. Various loan options exist, each of which has its pros and cons. Here is everything you need to know about credit card debt consolidation loan options available.
What Is Credit Card Consolidation?
Credit card consolidation is a strategy to get rid of your credit card debt as early as possible. The basic idea behind the different credit card consolidation methods is to combine the outstanding balances from all credit cards and pay it together at a lower consolidated interest rate. However, you only have a limited time to pay off your debt interest-free or at a low APR.
When you apply for one of the credit card consolidation methods, the bank will take into account your credit history, the amount of debt, your credit score, your home equity, any investments you might have, and even your attitude towards the entire situation. Nevertheless, credit card consolidation is the best way to eliminate debt but only if you’re determined to repay your debt in full.
One important thing to know here is that your application for credit card consolidation can reduce your credit score, particularly if your creditor thoroughly scrutinizes your credit history. But as long as you get the loan, it isn’t something to worry about since your credit score will only drop by a couple of points that will be re-gained as you pay off the debt within the specified time.
Loan Options for Credit Card Consolidation
Here are some of the ways to consolidate your credit card debt.
Personal Loan
You may want to consider obtaining a personal loan to pay off your credit card debt in full. While this credit card consolidation method won’t bring all your credit card balances under a single account, you can repay all your credit card debt with a single payment using the funds obtained from the loan. The loan will carry a lower interest rate, so you’ll now be left with a single low-interest loan to repay, making repayment easier and faster.
The rate of interest you get on a personal loan depends on your credit history and score. Hence, if you have an exceptional credit score, obtaining a personal loan to pay off your credit card debt is a rational choice. As an added bonus, personal loans carry a number of flexible options. Thus, look for the one that best suits your budget and financial situation.
Seek Help from Family/Friends
If you have a strong bonding with a loved one, it might be a good idea to seek their help. If someone from your friends or family agrees to help you pay off your credit card debt, you’ll attain multiple benefits. You won’t have to meet any eligibility requirements and may not have to pay anything in interest, depending on the arrangement with the person.
When asking for help, disclose all information related to the debt you plan to repay. They might want you to abide by certain terms. Evaluate those terms to see if they’re feasible for you, and take them seriously and document them as well.
Besides, think twice before considering this option as it may strain your relationship with the person. Keep in mind that you’ll put their finances in jeopardy if you couldn’t repay them afterward.
Approaching Non-Profit Organizations
If you lack a sound understanding of banking and finance, the best option is to seek expert advice from a counseling organization. The organization you choose will analyze your financial health, help you devise a budget plan, advise you on how to resolve your credit issues, and pay off your credit card debt.
However, make sure you conduct proper research before choosing a counseling organization. This area is subject to fraud, so it’s important to carry out a background check for each firm you consider. The best way is to contact the consumer protection agency in your state or consult with a state attorney to confirm whether an organization has the license to work in the state.
Balance Transfer Credit Card
This credit card consolidation method allows you to transfer balances from all your credit card accounts to a single balance transfer credit card that carries a lower introductory APR than those of your credit cards. Oftentimes, you get a 0% introductory APR on the consolidated balance in your balance transfer credit card. However, the word ‘introductory’ has a more critical meaning that you might imagine.
It means that you have a limited period of pay off your consolidated debt at 0% annual percentage rate. As soon as the grace period ends, a much higher APR will be payable on any remaining balance. Therefore, your target should be to pay off the entire debt before the zero or low-APR window ends.
If, however, the credit cards are from the same lender, multiple balances won’t be allowed to be consolidated. Besides, it advised that you make the monthly payments in full as late payments can lead to the cancellation of your introductory APR.
A common mistake people make while using a balance transfer credit card is that they keep making new charges to their credit cards, which kills the purpose of credit card debt consolidation. By making new charges, you will only move away from your goal of achieving debt relief. Also, standard credit card APR will be applicable to any new charges you make. Hence, when considering this credit card consolidation option, stop making any credit card charges and use your monthly income to pay for any expenditure.
Closing thoughts
Credit card consolidation is a complex topic. People looking to attain debt relief often overlook minor details and end up getting worse off. By now, you should have developed a clear understanding of how each of these options works.