Digital News Report – Debt consolidation loans are used to combine multiple high interest loans into a low monthly payment. Consumers may use the loan to combine credit card debt, student loans, car loans or other personal loans into a single secured or non-secured loan.
The U.S. labor department reported this week that jobless claims increased 12,000 from previous week. More people have become unemployed with the four-week moving average hitting 482,500. Now more than ever, Americans are looking for ways to lower their bills.
Bank of America
Bank of America is now offering a debt consolidation loan for people who have finally “decided to do something about it.” The bank says their loan can save you “both time and money.”
The bank says borrowers need to decide whether they want to pay the loans off faster or lower their payment. In some instances, customers may be able to do both.
“The idea behind debt consolidation is a simple one: combine several higher-interest debts into a single, lower-interest debt,” BofA said in a statement. “Explore all the options”.
There are several ways to consolidate with Bank of America including:
1) A credit card which can be used to transfer the debt. You could pay 15 percent on one card rather then a higher rate on multiple cards. The bank may charge a 3 to 5 percent transfer fee.
2) If you are a homeowner, you can consolidate the debt into a home loan. This interest may be tax deductible.
3) An unsecured line of credit (ULOC) is another option. The bank is offering a line of credit similar to a credit card (but without the card). You can use the line to pay off other debts and consolidate your loans.
The bank warns customers to think about a new loan carefully. Make sure the new loan will not cost you more in the long run.
By Tina Brown