Credit cards have become an integral part of today’s economy. Unlike debit cards, credit cards allow the holder to spend money they do not currently have, in the form of a short term loan. Each month the holder has the option to repay this loan, or clear their credit card debt, and avoid any interest charges. However, if this monthly payment is deferred, there will be interest that will accumulate over the borrowed amount.
It often happens that a credit card holder fails to pay his monthly credit card bill, for multiple months, missing multiple payments. This results in significant debt being accumulated in the form of credit card debt. One option that the card holder could explore, would be to take out a personal loan, to pay off, or consolidate their credit card debt. This form of debt consolidation allows an individual to pay off their credit card debt in order to avoid additional interest being charged.
A personal loan to clear off credit card debt
Given that a personal loan is an unsecured loan (implying that there is no collateral), it proves to be a good solution to paying off credit card debt. The individual can use the amount from the loan to pay off their credit card debt. This will allow them to avoid additional interest piling on, providing them additional time to pay off the personal loan without accumulating more debt on their credit card. Additionally, this also allows them to consolidate their credit card and eliminate any repayment stress. Individuals can simply employ a personal loan emi calculator and find out all they need to about their personal eligibility and interest rates.
Benefits of using a personal loan to clear off your credit card debt
- It eliminates repayment stress. Individuals can help mitigate credit card debt by using their personal loan, allowing for seamless repayments of credit card debt, while the holder can make use of the less stringent repayment terms for personal loans.
- This strategy also allows for seamless borrowing without any collateral.
- Credit card debt is considered to be the most expensive form of debt. So, you can consolidate this debt with a personal loan, as person loan interest rates are relatively lower and more flexible. This effectively eliminates the additional risk of interest charges on credit card debt through effective personal loan payments. These payments can be gauged beforehand using a personal loan emi calculator.
Opting for a personal loan to clear off your credit card debt can provide a number of benefits. They can simply employ a personal loan emi calculator to assess their potential emi payments. Additionally, once they have an idea of the potential personal loan interest rates, they can simply fill out a personal loan form online to begin the application process. Most lenders have recognized this strategy and will provide specific personal loan options and personal loan interest rates to help consolidate credit card debt via a personal loan.