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Bankruptcy FAQ

Should you use a personal loan to payoff credit card debt?

On Behalf of | Apr 9, 2019 | Credit Card Debt

As your credit card debt mounts, you may feel like there’s no way out. While this is a difficult spot to find yourself in, there are many ways to escape credit card debt to improve your financial situation.

A personal loan is one of the better ways to pay off credit card debt. Here’s why:

  • You can group all your debt into one loan, saving you money on interest and making it easier to manage your finances
  • It’s an unsecured loan, meaning you don’t have to put up any collateral, such as your home
  • You can use it for other purposes, such as paying medical bills or taking on a home repair project
  • Using a personal loan typically costs less than a credit card, due to the fact that the interest rate is usually lower

Although a personal loan makes it easy to pay off your credit card debt, there’s something to remember: You’re simply moving your debt around, not eliminating it for good.

After you make this move, you’re left with the same amount of debt, with the only difference being that it’s now in the form of a personal loan.

If you’ve considered all your options, including a personal loan, and find that nothing suits your finances, don’t hesitate to learn more about bankruptcy.

This is typically a last resort, but it may be just what you need to discharge some of your debts and regain your financial footing. Learn more about Chapter 7 and Chapter 13 bankruptcy to ensure you are taking the right steps at the right time.