Harrison Funding is offering 3.03% a APR loan offers that are simply unrealistic unless you have excellent credit. Crixeo, the popular news and review site, has done a review of Harrison Funding and is still waiting to hear from someone who has been approved with an interest rate this low. Or Is it simply part of a long-running bait and switch scam?
According to Ed Miles of Crixeo, “The story is the same. They lure you in by sending you direct mail with a “personalized invitation code” and a low 3.03% APR to consolidate your high-interest credit card debt into a new personal loan. You will be directed to the My Harrison Funding website. More than likely you will not qualify for one of their personal loan offers and they will try and flip you into a more expensive debt product.
If you owe a huge amount of credit card debt, you are not alone. Millions of Americans are struggling to pay off their credit card debts, and each year this number continues to increase. As convenient as credit cards may be, they can completely spiral out of your control if you do not manage them properly.
Though getting out of credit card debt is not an easy journey, it can be done quickly and seamlessly if you do it the right way. You might be wondering how you can pay off all of your credit card debts. You may also have multiple questions about your debt. Should you consider talking to a credit counselling agency? Is there any way you can stop paying all of your debt in the next few months?
Well, there is a strategy that can help you pay off your credit card debts quickly, and that is credit card consolidation. Continue reading to find out everything about this debt repayment strategy and how you can get started with it.
What is Credit Card Consolidation?
Credit card consolidation refers to a debt repayment strategy in which you consolidate or combine multiple credit card debts into one monthly payment. Typically, you can do this either through another credit card or by taking out a loan. This method allows you to simplify your debt repayment, help you better manage your finances, keep track of them, and pay off your loans quickly.
Who Should Consider Credit Card Consolidation?
Typically, anyone who has multiple outstanding credit card debts should be considering this method to pay off their credit card debts. If you are struggling with your credit card debts and can no longer manage to make monthly payments, this strategy might be worth it. Moreover, if you have a good credit score, using this method will allow you to not damage your credit score as much because you will no longer be paying high-interest rates anymore.
What Are the Different Types of Credit Card Consolidation?
There are three main types of credit card consolidation that you can consider. These include credit card balance transfer, home equity loans, and personal loans. Let’s take a closer look at each of these types.
1. Credit Card Balance Transfer
This type of strategy involves transferring the balance from all your credit cards towards one single credit card and then paying off the debt through a single monthly payment. With this method, you will not just be simplifying your life and debt repayment, but you will also be able to save up since you will not be paying high-interest rates anymore.
Credit cards usually offer promotions in which they offer a 0% APR if you transfer your balance to their credit card. Thus, you will not be paying any interest for the first few months. This is particularly beneficial for you if you have been paying a high-interest rate on your current credit cards. However, it is essential to note that there is a transfer fee involved.
2. Debt Consolidation Loans
Banks and financial institutions offer what is known as debt consolidation loans, which are essentially unsecured personal loans designed to help anyone who wants to pay off multiple debts. In this method, you receive a loan that you can use to pay off all your outstanding credit card debts and then pay off the lender through single monthly payments.
Compare Debt Consolidation vs Refinancing.
Debt consolidation loans have a fixed interest rate, which is likely to be lower than your current interest rate on your credit cards. Since credit cards do not have a fixed interest rate, you will probably be saving up through that as well. There is also a fixed repayment plan that continues for a year or six months, and you will have to follow it to pay off the debt.
3. Home Equity Loan
This is similar to a debt consolidation loan as you will be receiving funds to pay off all your outstanding credit card debts. However, you can borrow up to your home’s equity, meaning whatever the value of your home is. Moreover, home equity loans require you to use your home as collateral. Therefore, if you are unable to pay off the loan, you could lose it through foreclosure.
Similar to debt consolidation loans, you will have a fixed interest rate and a debt repayment schedule that you will need to follow. Though this strategy is a significant risk since you are using your home as collateral, if you can pay it off, you will be saving a lot of money in the long run.
What Are the Alternatives to Credit Card Consolidation?
For all three of these strategies, you will need to have a good credit score and history. For example, you will only be allowed a debt consolidation or home equity loan if the lender has seen that you have made consistent payments in the past. Therefore, if you do not have a good credit history, you should consider other alternatives. These include credit card hardship plans.
Debt Repayment Plan
This is similar to credit card consolidation, as you will be making single monthly payments. However, you will be doing this with the help of a credit counseling agency to whom you will be making these payments. These agencies negotiate lower interest rates or fees on your behalf, which allows you to make monthly payments to them.
This is a debt repayment strategy that does not involve consolidating any of your credit card debts. However, it is still an excellent way to tackle your debts. It involves paying off the debt, which has the highest interest rate first and then working your way to the subsequent ones.
This is similar to debt avalanche, but instead, you will pay off the credit card debt which has the smallest balance first and then move on to the second smallest one and so on. This allows you to stay motivated and consistent with your payments.
The Bottom Line
Credit card consolidation is an excellent way to pay off your credit card debt and save money by not paying extra interest rates. It is even more beneficial because it helps you pay off your debts much faster. However, this is not an option for everyone. Therefore, you should take a look at your payment history and financial situation before committing to this debt repayment strategy. Good luck!