Let the Bank Help – Smart Debt Management
When you are struggling with high debt balances and the heavy burden of monthly payments that have become unmanageable, the bank may seem like anything but your friend or ally. After all, you may have credit cards or loans with the bank, and the bank may want its monthly payments from you. Perhaps you only have a checking or savings account with the bank, and you may be frustrated by accounts with limited assets in them. It is easy to view the bank as a veritable enemy in such cases, but the reality is that you can work with the bank to take advantage of special programs and offers. Such options may be used for smart debt management to help you get back on sure financial footing.
Refinancing Your Car Loan or Credit Card Debt
Credit card and car loan payments may easily eat up hundreds of dollars or more each month, and these payments can be difficult to make in some cases. Reining in these payments and making them more manageable may be a top financial goal for you to accomplish, and this may be an option you can pursue through refinancing debt. For example, you could refinance your auto loan with your bank to enjoy the benefit of a lower interest rate, a longer term and lower payments. Credit card debt can also be refinanced to an account with more attractive terms for additional monthly cash savings.
Refinancing Your Home Mortgage
While credit card debts and car loan payments make up a significant bulk of your monthly expenses, your home mortgage payment likely is your single largest expense. Your bank may be able to take a huge financial burden off of your shoulders through a home loan refinance. Consider that you may be able do a rate and term refinance to lower the interest rate, reduce interest charges and even lower the monthly payment. You may also be able to apply for a cash-out refinance, and you can then use some of the equity from your home to pay off other debts that you have. Some homeowners can accomplish both of these goals with a single loan for great financial benefit.
Applying for a Debt Consolidation Loan
Refinancing existing debt is one option to consider for your credit cards, car loans and home mortgage, but it is not the only way a bank can help you. For example, you could apply for a debt consolidation loan. This typically is an installment loan with a fixed payoff debt, so it can establish your debt on a better repayment plan with a definite final payment date. You can rollover your credit cards, student loans and other debts into a single consolidation loan, and this can result in lower debt payments, easier debt management and a better repayment schedule.
Your bank may seem like it is working against you when it asks for payments on credit cards, car loans and more, but this is not really the case. In reality, the bank wants to work with you to set up a manageable debt repayment plan. These are some of the top ways your bank can help you to improve your financial situation with a smart debt management plan, but they are not the only options. It is wise to reach out to your bank representative to discuss your financial situation and to learn more about how you can use banking services and programs to improve your debt status.