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According to the to Federal
Reserve Board, 58% of families with credit cards
carry a balance on their credit cards. The average
balance owed on those credit cards was $5,100.
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We all know that averages can be deceiving.
If you put ten people in a room, and one of
the owes $100,000 on their credit cards, and
the other nine have no credit card debt, the
average balance owing is still $10,000. It doesn't
matter what the average person owes; what matters
is what you owe on your credit cards.
If you owe more on your credit cards than you
can afford to service, a credit
card debt consolidation loan, may be an
option that you should consider.
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Do you need a debt consolidation loan for your credit
card balances?
According to the to Federal
Reserve Board, 44% of all families, including
those families that don't have any credit cards, have
balances owing on their credit cards. If the head
of the household is between 35 and 44 years old, that
percentage increases to 54%, so it's easy to see that
credit card debt is a serious problem in America today.
Even worse, the average family owes $2,000 on credit
cards, $4,200 on lines of credit (not including mortgages)
and $10,300 on installment loans. With this level
of debt it's easy to see how families can get into
trouble.
The problem with credit card debt, of course, is
that the interest rates on bank credit cards can be
as high as 19%, and the interest rate on department
store or gas company credit cards can reach 25% or
more, so consumers end up paying a huge amount in
interest on these cards.
The solution for many people is a debt consolidation
loan to repay your credit cards.
To qualify for a debt consolidation
loan, you will need to have sufficient income to repay
the new loan. However, if you have been managing to
make your payments on your 25% department store credit
card each month, you will probably be able to make
a loan payment on a 9% bank loan.
To see if you qualify for a debt consolidation
loan to repay your credit cards, follow
this approach.
First, make a monthly budget to see what you can
afford to pay. By doing the math for yourself first,
you won't commit to a higher payment than you can
afford.
Second, make an appointment to see your bank manager
or loan officer. Don't just show up at the bank; book
an appointment first.
Third, when you go to your appointment, bring with
you a recent pay stub, and last year's tax return
as proof of your income. Bring copies of all of your
credit card statements, and any other debt consolidation
loans or other loans you have outstanding.
If you come prepared, the bank will be better able
to provide you with the credit card debt consolidation
loan you require, and get you back on track.
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