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Digital News Report – Many Americans have been going into debt while making personal consumer purchases. Besides a mortgage, the biggest debt is usually the car.
So what can be done if you are overburdened with debt? Advisors say to prioritize. Pay for your necessities first. Cut down on expenses, pay the minimum on your secured loans and keep up-to-date on your insurance.
The second priority should be your revolving debt. American consumers have $795.5 billion in outstanding credit card bills. This is down from $957 billion in 2008, but it is still a big problem.
Finally, start an emergency fund, save for your retirement and pay off your student loans. Personal finance guru Suze Orman says Americans need to save for eight months of their bills if they lose their job.
Debt consolidation loans can be used as an immediate relief to the high cost of personal debt. There are two basic types: secured and unsecured.
Multiple debts are paid off and a new single loan takes their place. The goal is to save money and hopefully decrease the term of the loans.
Unsecured debt consolidation loans usually carry a higher interest rate but require less paperwork. Most banks would prefer security so they charge a higher interest rate for the risk.
“You can enjoy instant access to funds on an ongoing basis via U.S. Bank’s Premier Line of Credit,” U.S. Bank said in a statement. The bank says that their premier line requires an existing checking account with them.
Credit score is important. Most banks will charge a higher rate for customers with a poor or even bad credit history. U.S. Bank says borrowers need to meet “underwriting policy guidelines”.
Secure loans are easier to get because there is less risk involved for the bank. U.S. Bank offers secured debt consolidation loans and lines’ of credit too.
By Tina Brown