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I’m Considering a Sweep Loan to Pay All the Credit Cards Off. – Jonathan

“Dear Steve,

I have 13K of credit card debt with high interest rates on top of a very large student loan bill. I make 6 figures, but find it very difficult to pay these debts down. I’m considering a sweep loan to pay all the credit cards off and lower the interest rate.

What recommendations do you have for choosing a sweep loan, if in fact you believe that these are good ideas given my situation.

Jonathan”

Dear Jonathan,

When you say ‘sweep loan’ I assume you are talking about a debt consolidation loan. The best debt consolidation loans are going to be a cash out refinance of your current home, a home equity line of credit or a balance transfer offer to move your current credit card debt over to a 0% intro rate offer. They do still exist. Click here to look at credit card deals. All of those options are dependent on you having good credit with a credit score above 720. If you don’t know what your credit score is, you can click here to get your credit score.

If your credit has taken a hit and your credit score is lower than 720 then you will have less attractive options. Without getting a debt consolidation loan you could use the debt snowball approach and knock out your credit card debt as quickly as possible. You could look into a debt management solution but while that might lower your interest rates, you’ll also take a shot to your credit report.

Outside of those options, you could also consider borrowing from family or friends for a cheap way to eliminate your credit card debt.

Sincerly,
Steve

You are not alone. I'm here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don't give up.

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About the author

Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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