Benefits Of Paying Your Credit Card Bill by Availing a Personal Loan

A Brief Overview

This article seeks to shed light on the benefits associated with paying your credit card bill with the aid of a personal loan.

By owning a credit card, you must pay your bills on time to avoid being lumped with fees associated with not paying on time. Moreover, you can witness a sharp decline in your credit score, indicative of your lack of creditworthiness, by missing out on a credit card bill payment.

To avoid the same, consider availing a personal loan online to cover your credit card bill.

What are the Benefits of Paying a Credit Card Bill with a Personal Loan?

By availing of a personal loan, you can pay your credit card bill on time which is a significant relief. Several benefits are associated with this line of funding, the more prominent of which have been mentioned below.

You can potentially earn a lower interest rate.

If your credit card carries forward an outstanding balance, you can potentially have to pay an annual percentage rate or APR of 20 percent or more. In contrast, those with good credit could face an APR of 12 to 17 percent, depending on their card.

On the other hand, the interest you would be exposed to with a personal loan would fall below 10 percent. This interest rate may even be lower if you have a good credit score. This implies that you could reduce your total interest payment in half and may even be able to pay back your dues earlier because your interest will be lower.

Streamline your payments by consolidating them.

If you pay several credit card payments each month, keeping track of them may be demanding regarding the dates by which they are due and the owed amounts. You could incur late payment fees and witness a drop in your credit score by missing a payment.

Personal loans allow you to consolidate each of your credit card payments, leaving you to pay a monthly fee on your loan rather than several. This can help you free up time and space.

Boost your credit score.

Although personal loans imply that your credit is checked thoroughly and can temporarily drop your credit score, they can positively impact your credit score in several ways.

For starters, by availing of a personal loan, you add diversity to the line of credit extended to you, which can increase your score by 10 percent. This is because it relays to creditors your responsibility with money.

Furthermore, your credit utilization will reduce because you have paid more towards your debt. The lower your credit utilization, the better your credit score.

Conclusion

While you might be hesitant about a personal loan, it may be in your best interest to maintain a good credit score and avoid late payment fees. Visit Finserv MARKETS today to learn more about personal loans with low-interest rates.