On average, people usually have a credit card balance of around $5000. This isn’t that surprising. Life can be unpredictable at times, and you never know what it might throw at you or at what point. Some people lose their jobs unexpectedly, others find out that they have a baby on the way and that they could use some cash, and some simply like indulging themselves. In short, there is a great deal of situations that can get you in debt.
Credit cards have certainly become an indispensable part of our lives. We all use them for one reason or another, and now is not the time to get into those reasons and to start assessing everyone’s spending habits. Sure, we could probably all use a bit more control when it comes to spending, but that does not immediately mean that you need to cut all the costs, lock up in a room and live your life without ever experiencing anything that requires money, other than food and shelter.
It just means that you need to gradually start changing your habits until you are sure that you are spending your money as wisely as possible, but without limiting yourself too much. Think of this as of changing your diet. If you go on a strict regime for a couple of months, you’ll probably start overindulging after some time. If, however, you take the time to actually change your habits slowly and effortlessly, you’ll succeed in eating healthier. It’s the same when it comes to money.
Anyway, I am not here to talk about your spending habits, as explained above. So, this was just a simple tip that you can use if you want to do something about changing those habits. If you’re happy with them, though, then there is no need for changing anything at all. Anyway, debt can accumulate even if you are trying really hard not to spend too much, because, well, that’s the world we live in today.
What To Do About Those Debts?
What happens, though, when you find yourself in debt and you don’t have an idea about how to repay it? If you are waiting for a bank to just forgive the debt, let me tell you right away that nothing like that will happen. It will just keep on accumulating the more you are trying to ignore it. So, ignoring it is definitely not an option, as I am sure you understand by now.
Well, what are your options, then? To be blunt, the only thing you can do in order to keep the debt from accumulating is actually repay it. That, however, might be easier to say than to do. If you don’t have any money lying around just waiting for you to use it for repaying the debt and if you don’t have anyone who could lend you or gift you the amount you need, then you will have to start thinking about a different solution.
The solution I am referring to is credit card refinancing, or refinansiering av kredittkort. You must have heard of this option before, but that does not mean that the concept is completely clear to you. Those financial “thingies” can certainly get quite complicated for everyone, so it is no wonder that you are perhaps a bit confused about how all of this works. The good thing is, you can always find the information you need online and you can, thus, get your facts straight on the entire concept.
If you are ready to get your facts straight and learn as much as you can about kredittkort refinansiering, then you should basically just keep on reading. Below I will try and answer some of the most common questions that people have about this particular option and thus help you learn what you need to know about the process of refinancing your credit card. Once you get a clearer idea on everything, you will be much more capable of deciding if this is something you want to do. And, of course, you’ll also learn how it is done, so you won’t need to worry about making mistakes in the process.
What Is Credit Card Refinancing?
We are, of course, going to begin with the most basic question here. What exactly is credit card refinancing? To put things simply, this concept consists of using a personal loan to pay off your credit card debt. This way, you will get to combine all your credit card payments into a single loan payment that will come at a fixed interest rate. This is why the process is usually called debt consolidation.
The process can work in two ways. You can find a lender, get a loan and let the lender directly pay off your credit cards. Or, you can get the lump sum deposited to your account and then use it to pay off the debt. In any of these two cases, you will be left with monthly payments that you’ll need to make regularly in order to repay the personal loan that you have taken out. The great part is, most of those personal loans that you’ll find these days are unsecured, meaning that you won’t need to provide collateral.
Is It Always A Good Idea?
Does the above sound a bit like spinning in circle? Basically, you repay a debt, but you are still left with some debt, or possibly even more than before. Well, I get where you are coming from, and I am not going to argue that kredittkort refinansiering is always a good idea, because it most definitely isn’t. In short, this isn’t a good idea when the interest rate on your new loan is higher than the rate you already have on your debt, and when the terms are generally less favorable.
When To Refinance?
Since this is not always a good idea, you must have started wondering when it is that you should refinance. Let me make this perfectly clear. Most of the personal loans that you will find will have lower and, most importantly, fixed interest rates. Thus, you’ll be able to lower your debt by committing to a lower interest rate, and the monthly payment will always be the same. Everything will be predictable and you won’t have to worry about more and more debt accumulating due to you not being able to pay everything on time.
Of course, this does not mean that you should not worry about paying those monthly installments on time, because you might get some penalties if you don’t do that. Still, the bottom line is that you’ll consolidate your debt and have just one monthly payment to make, while also making sure that the interest rate is lower and that the general terms are more favorable. When you find out that this is what you can achieve, then that’s when you should refinance.
Another great reason why you should start thinking about kredittkort refinansiering is if your credit score has improved recently. With a great credit score, you will have higher chances of getting an unsecured loan with a reasonable interest rate. If your credit score is poor, though, then the rates will be high, in which case refinansiering might not be the right move for you.
In the event that all of this sounds a bit too complicated for you right now, I would advise you to talk to a financial expert, or to some lenders for that matter, so that you can get a professional opinion and get everything sorted out. Nobody will be able to give you better advice than the people who have been working in the finance industry for quite a long time now. Thus, don’t hesitate to talk to experts about this.
If you’re looking for more ways to consolidate your debt, this should help: https://www.nerdwallet.com/article/loans/personal-loans/consolidate-credit-card-debt-personal-loan
How To Do It?
In case things are perfectly clear to you right now and you are sure that kredittkort refinansiering is the right move for you, then you’ll just need to learn how to actually do this the right way. The process really isn’t that complicated, but it is still worth explaining, because I am sure that you don’t want to end up making certain mistakes and then regretting your decisions afterwards. So, I will now explain what it is that you will need to do in this particular process and you’ll hopefully get a much clearer picture on everything.
First and foremost, you will need to find a great lender. And, when I say “great”, that’s exactly what I mean. There are, without a doubt, a lot of lenders out there that will be ready to offer you their personal loan options and refinansiering opportunities, but that does not mean that all of them will be a great choice. You need to find lenders that will offer you the best terms.
How can you do that, though? Well, fortunately, there are some amazing websites out there that can help you not only find various different lenders, but also easily compare the terms and the interest rates that they are offering. So, you should undeniably use those websites to your advantage, because they can help you find the perfect option for you. You can also get recommendations from some of the people you know. Whatever you do, though, don’t forget to compare the rates, as they play a huge role in the success of your entire kredittkort refinansiering journey.
Once you’ve found a great lender, there’s not much left to do. You just need to check their requirements and prepare any documents that they might need from you. Of course, if that’s a possibility, make sure to improve your credit score as much as possible before applying, as that will increase your chances of getting the perfect terms. When all of that is done, you simply have to file the application and wait for it to be approved.
As already previously explained, you can have the lender pay off your kredittkort debt directly, or you can have the money deposited to your account and then do it yourself. It is up to you which option you’ll choose here. In the end, the goal is to pay off the kredittkort debt, and that’s what you’ll get to do with the refinansireing option.