I am trying to get out of debt and at the sametime trying to figure out what will be a better way.
I have about $9.9k in credit cards debt, 2 car loans (~$19k) and a personal loan with $4200 left. I am making all my payments on time and always paying my cards more than the minimum, most of the times 3-4 times more on some cards. My credit score is about 689 at the moment and never had any issues getting any credits approved. Also never had any late payments, late bills or any collections.
My question will be – is it worth to get a $15K Solution Loan and pay all my CC and the personal loan. I tried the Prosper and they denied it (most likely) because of the amount of debt owed. Now I just got an offer from First National Bank of Omaha – First Solution loan program (are you familiar with this bank and any business they do?). They are offering a credit line between $5-25k at 7.99-14.99 APR. So I was thinking if I take $15k for 48 Months ($380) a month that may get me out of the many CC debt situation.
But I need a smarter advice from an experienced person.
Thank you in advance and looking forward for your reply!
I took a look at the First National Bank of Omaha website and I see they do offer something called the First Creditline loan program but their current interest rate in 18%. They are also offering an unsecured loan for between 5.99% – 17.45%. – Source
A debt consolidation loan can be a smart way to get out of debt as long as you don’t fall back into debt while you are repaying the previous loan. Additionally, remember to NOT close the credit cards you pay off. You will want to at least keep the three oldest cards open to help boost your credit score with your long relationship with those cards.
I suspect the offer you got in the mail is just an offer and not an approval for the loan. This will leave you in the same boat as you were in with Prosper. It might be a good idea to call the bank and explain your situation before applying. They might be able to share with you what there approval criteria is for debt to income ratio and save you some angst and grief.
Please post your responses and follow-up messages to me on this in the comments section below.