Consolidate Your Debt With a Personal Loan

What is Debt Consolidation?

Debt consolidation is the merging of multiple loans into one large loan. Debt consolidation allows people with multiple debts to combine all high interest loans into one bigger loan that offers interest rates relatively low. Generally, the more you borrow, the lower the cost of the loan (the interest rate charged on the loan). Therefore, if you have multiple debts, using personal loans to consolidate debts it could potentially reduce the interest you pay.

In addition to saving money to pay interest, debt consolidation also provides convenience to pay all your debts through a personal loan. In many cases, people usually get mortgages, car and personal loans from different institutions. In addition to a variety of interest rates, these loans also require different payment some at various times that can make you trouble, not to mention a hassle to manage. Consolidate all your debts into a single debt help you easily manage transactions through a single monthly payment.
 

What You Need to Know Before Consolidating Your Loans

Although it may sound alluring, there are a few things you should keep in mind the borrower before taking a personal loan for debt consolidation. While debt consolidation has the potential to save you money on interest rates and help you manage your debts efficiently, still means that you pay a large monthly payment. Therefore, if the borrower does not manage his finances current and future well, they can be trapped into a debt trap.

Therefore, as a first step in creating a healthy financial lifestyle, you first need to know the size of all loans, the different monthly payments and how much longer you are still paying the loan, respectively. This is when a loan calculator is very useful.

The next step is to compare the total debt with your income. Once you have done a summary of your current financial position, began to approach the different banks and compare each of their interest rates, product offers, terms and conditions. Use comparison sites to accelerate this process. While the idea of ​​consolidating your loans is to provide you with a lower interest rate, it is equally important to consider other factors such as convenience and flexibility of loan payments.

In the end, though debt consolidation may reduce the amount of interest you pay on a loan that is different, in some cases, it may not even happen. Consolidation of debt is not a solution to your debt, but only combine all your debts into one lump-sum. If your current monthly payment under the debt consolidation loans seem smaller, it could happen because the longer the loan term, which means you could potentially pay a greater rate than previously.

What is Credit Card

Credit card is a payment card issued by a financial company, where cardholders can purchase the product or service in the form of credit. Currently available a wide range of financial services company credit card issuer in the world, despite the fact that credit card providers in the world there are only three, namely VISA, Master Card and American Express.
 

How is Credit Cards Work Systems?

Credit cards have a way of working as a short-term loan. When you make a payment using a credit card, you basically have to borrow money from the card issuer. And at the end of each month, you are expected to pay back the money you borrowed. Failure to do this will cause you to be fined based on the lending rates of the rest of your bills unpaid.
 

Different types of Credit Cards in Indonesia

Currently, it has provided various types of credit cards with the advantages and usefulness of different. There are a variety of credit card types that you can choose from such as:

• Reward Card: This card type gives Reward Points for every transaction that you make using your credit card. Reward Points can be redeemed for prizes such as vouchers, electronic devices, air tickets, free annual fee or other gifts listed in shopping card issuer catalog.
• Cash Back: Type of this card gives cash back (refund) every time you make a transaction at stores that have been determined.
• Low Annual Charges: Type of this card gives annual fee is lower than other conventional credit cards.
• Traveling Miles: This card type gives mileage points for certain transactions that can be redeemed for flight facilities such as airport lounge or air tickets from airlines that have teamed up with the card issuer.
• Petrol: This card type benefits associated with the purchase of gasoline such as cash back (refund) in the petrol kiosk.
• Premium: This card type offers luxuries such as golf, fine dining, the best range of services and benefits, as well as an exclusive club.

 

Credit Card Interest Rate

Credit card interest rates will wear on you, when you choose not to pay off all of your transactions from bank loans at maturity. Obviously the faster the bills paid, the less the interest to be paid. Make sure you understand the terms and policies of your credit card. The interest rate varies from one card to another card, which generally ranges from 33% to 36% per year.
 

Grace Period and Minimum Credit Card Payment

This is the number of days in which the bank allows you to borrow money without interest. The grace period can vary up to 25 days depending on the bank issuer. The grace period usually applies to new transactions, but only if there is no outstanding balance from the previous month. The minimum payment that you pay a certain amount specified in the card holder's bank for payment of bills. In general, the amount to be paid is worth 10% of the total bill or at least $ 5, -
 

Repayment of the Credit Card Bill

On a specific date each month, the card issuer will send you a monthly bill. Commonly, the cardholder must make a minimum payment of 10% of the total bill (or at least 50 thousand). You can choose between paying a credit card bill in full so that you do not bear interest, or in installments in which you will be charged interest.
 

Due Date and Date Print

To print the date of determination and maturity, every bank has a different date and you must check directly to your bank. However, usually each bank determines the due date 15 days after the date of the transaction printing. For example, print date of your credit card transaction is dated March 1, the due date of your bill is dated March 16. If you make payment before the due date of March 16 as a whole then you will not be charged any interest but if you pay by way of installments, the outstanding balance you will be charged interest on the next month.