Debt consolidation is a wise choice for people looking to reduce or eliminate their debt. Because of high interest rates, reducing debt is almost impossible. Getting a higher paying job may help. However, there is an easier solution for eliminating debt. Debt consolidation lumps all your debts into one loan. Helping you pay off debts quicker.

Debt Consolidation Loans Equals Lower Interest Rate

Banks and financial institutions that offer personal debt consolidation loans offer great rates for people with good credit. The average credit card interest rate ranges from 14% to 25% - sometimes higher. Because debt consolidation loans have a much lower rate, you will receive huge savings. For example, instead of paying $300 a month for credit cards, your consolidated loan may be $200 a month.

Debt consolidation loans must be secured by a piece of property. This could include a car, boat, or home. Home equity loans are ideal for those looking to consolidate their credit card and consumer debts into one payment. In addition to debt consolidation, home equity loans are perfect for home improvements, paying for college, or taking a dream vacation.

Using Home Equity Loans to Consolidate Credit Card Debt

Home equity loans are based on your home's equity. If you owe $100,000 on a $175,000 mortgage loan, your home's equity is $75,000. Thus, you may obtain a home equity loan for up to $75,000. Use this money to consolidate debt. However, weigh the pros and cons before obtaining a loan. Because the home equity loan is secured by your home, if you refuse to pay the loan, the lender may foreclose your property.

Applying for Debt Consolidation Loans Online

Completing a debt consolidation loan application is simple. For convenience, consider submitting an online application. Various lenders offer loans. Furthermore, there are lenders that offer loans to individuals with poor credit. In order to get the best rate on your debt consolidation loan, compare rates from different lenders.

Contact your current mortgage company. If you have good credit, the lender may be eager to give you a loan. Getting a quote request from a loan broker is also beneficial. These individuals do all the legwork for you. After a loan broker receives your online application, within minutes they will email you a list of multiple offers. Compare and contrast the rates and terms, and then choose the most attractive loan package.

Here are our Recommended Debt Consolidation Companies Online.

Carrie Reeder is the owner of ABC Loan Guide, an informational website about various types of loans.