At Allegacy Federal Credit Union, we will always do the right thing for your wellbeing. If you have several monthly bills that are all due on different days of the month, consolidating the debt into one loan with a single monthly payment could help you simplify the monthly bill paying process. Consolidation could also save you money by moving multiple revolving/high interest (usually variable) balances into one loan.
Many times, debt consolidation options are heavily advertised as the solution to getting your bills paid on time. Here’s a candid look at what you need to be aware of before deciding that a consolidation loan is the right solution for you.
Will it pay off all your debts? If not, you may be just changing around the amount you owe on some debt without really accomplishing the goal of simplifying your monthly payments.
Will it take longer to pay off now? A lower payment can mean a longer term. That isn’t necessarily a bad thing, but be aware of how long it will take to pay off the loan. Also, check how much you’ll be paying in interest compared to how much interest you’ll be paying if you leave your current debt alone.
Will you still be able to use your credit cards or other revolving debt? Some lenders require you to close the accounts you are paying off with a debt consolidation, others do not. It may be a smart financial choice to close out those accounts whether required or not or you may find yourself strapped with the original amount you owed on your credit cards within a few months – on top of the debt consolidation loan you took out to resolve the problem.
Are there fees involved? Find out what they are so that you can see if it still makes sense to go ahead with the loan when you take those fees into account.
Will your home be used as collateral? Many debt consolidation companies use a regular salesperson and call him or her a “consultant.” Don’t take advice from these people. Ask questions, do research, and find out what the facts are before you sign anything. Using your home as collateral may make it difficult or impossible to refinance or sell your home should the need arise.
Before you decide that a debt consolidation loan is right for you, visit one of our Financial Centers or call 336.774.3400 to review your debt situation. As you are preparing for your financial wellbeing, our Allegacy Visa® Credit Cards can help you make things happen — from consolidating high-interest debt to having the flexibility to make purchases to meet your needs.
*Now until April 30, 2018, you can take advantage of one or both of our special introductory rate offers of 0% APR on Purchases and 0% APR on balance transfers with alow 1.5% balance transfer fee.
*All loans are subject to credit approval. Rates are based on your credit history and profile. Rates, terms, and products are subject to change at any time without notice.
1APR= Annual Percentage Rate. Both Introductory APRs available from January 1, 2018 through April 30, 2018. 0.00% Introductory APR for purchases for 12 billing cycles following the first transaction. After that your variable APR will be between 9.40% to 14.40%, based on credit worthiness and will vary with the market based on the Prime Rate. 0.00% Introductory APR for balance transfers for 12 billing cycles following the transaction with a 1.5% balance transfer fee or minimum of $5.00 for each transaction, whichever is greater. After that your variable APR will be between 9.40% to 14.40%, based on credit worthiness and will vary with the market based on the Prime Rate. There is no annual fee, but cash advance and foreign transactions fees may apply. Click here for additional terms and conditions.
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