Debt Consolidation Loan vs Balance Transfer Card: Which Can Save You More?
Debt consolidation loans and balance transfer cards can both simplify repayment, but they suit different situations. A consolidation loan combines several debts into one fixed monthly payment, while a balance transfer card moves existing card debt to a new card that may offer a temporary 0% interest period. A balance transfer card can be cheaper if the debt is mainly from credit cards and you can clear the full balance before the promotional period ends. Remember to factor in the transfer fee. If you miss the deadline, the interest rate may rise sharply. A debt consolidation loan may be more suitable if you have several types of debt, need a longer repayment period, or prefer predictable monthly instalments. Compare the total cost, fees, repayment term and interest rate before choosing either option. Avoid taking a new facility unless you have a realistic repayment plan.
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