“Dear Steve,
I am also inquiring about the First National Bank Of Omaha’s First Solution Debt Program. I have good credit and income, homeowner and just refinanced my home and saving the same amount that the new payment will be. So i should be able to still put additional money into savings every month.
I too have quite a bit of unsecured credit card debt ($19K) that I pay on every month. I received the offer from FNB Of Omaha and decided to give them a call. After speaking with the loan officer on the phone, I decided to go ahead and proceed with the application process. She approved my request and offered me a 36-72 month term loan @ 10.99%.
I am reluctant to go ahead with the offer as it sounds too good to be true. There are no fee’s (with the exception of late fee’s etc.) associated with this loan, no pre-payment penalty nothing.
My question is, should i go ahead with the offer and if so should I do the longer term as it will reduce the payment, and still allow me to pay-off the debt quicker if I can?
Earnest”
Dear Earnest,
I’ve never seen the program terms and conditions so I could not make any statement about them.
The key points to look for in the loan terms and conditions are if the interest rate is fixed, and not variable, make sure there is no pre-payment penalty, and make sure you understand how additional payments will be applied to your account. We want extra payments going towards the balance owed and not future interest.
I would suggest if you go ahead with the loan you select the longer term but make monthly payments equal to the shorter term. If you find yourself in a pinch, you can always fall back to the lower payments.
Keep in mind you should NOT close the credit cards you pay off with the loan and it would be wise to inquire if the loan will be reported to all three credit bureaus. If they report your good payment history it will help to keep your credit score looking sharp.
As you mentioned, keep up the good work of continuing to set aside money in savings every month as well.
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