Consolidating your debt
Plus, some lenders will send payment directly to your creditors, so you won’t be tempted to use the loan funds for something else.
And many lenders offer the option of applying for prequalification, so you can shop around to see what your potential options are without impacting your credit scores.
Pros: A credit counseling organization may work with your creditors to set up a debt-management plan on your behalf, which requires you to make a single monthly payment to the credit counseling organization each month.
The organization then uses the money you provide to pay your creditors.
Also, the amount you transfer — including any fees charged — can’t be higher than your credit limit, which may not be high enough for you to pay off all your debt.
Depending on how much money you owe and what your overall financial picture looks like, it may make sense to ask a friend of family member to lend you the money.
But if you opt for this method, it’s important to be sure the loan terms and repayment plan are clearly outlined, just as they would be if you were getting a loan from a financial institution.
Some lenders offer cash-out refinance auto loans that allow you to use the equity in your car to issue you a loan for other expenses, like consolidating credit card debt.
But if you’re unable to make your payments, you risk losing your vehicle.