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Prioritise Debt Repayments
One of the best ways to speed up the repayment of your debts is to focus your attention on paying off the loans that carry the highest rate of interest first. Get rid of the debts that cost you most to service.
Get The Best Deal Get the best loan deals that are available to minimise the interest that you pay. Fact: It’s much easier to repay a loan with an interest rate of 5.9% APR than one set at 29.9% APR. The less interest that you have to pay, the more you’ll have left to repay the amount originally borrowed. Transfer each of your debts to as low a rate of interest as you can find. Transfer debts on your credit cards to a lower rate card. You might be able to find a card that gives zero percent interest on all balance transfers for 6 months. Likewise, why continue to pay 30% APR on your storecard debts, when you could transfer the balance to a credit card that charges a much lower rate. But if you decide to do that, I’ve got two warnings for you. When you transfer debts from one of your plastic cards, destroy the old card immediately! Avoid the urge to keep them, or before you know it both cards will be up to their limit, and you’ll be looking for an even lower rate just to keep up with the repayments. And second, don’t waste these interest free periods. Just because you don’t have to pay interest for a while, don’t ease up on your efforts. Keep paying as much as you can to reduce the size of the debt. Interest free periods are a golden opportunity to substantially reduce your debts. Don’t look on them as a ‘payment holiday’, or as an excuse to increase your spending. by Stuart Laing Copyright (c) Get Out Of Debt About the Author: Stuart runs a website dedicated to helping people get out of debt. So if you want to improve your financial position, visit www.icanhelpyougetoutofdebt.com for free, impartial information on how to reduce debt.
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