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 virtue of being in possession of a credit card, you are required to pay each of your bills on time in order to avoid being lumped with fees associated with not paying on time. Moreover, by missing out on a credit card bill payment, you can witness a sharp decline in your credit score indicative of your lack of creditworthiness.
In order 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 major relief. There are a number of benefits associated with this line of funding, the more prominent of which have been mentioned below.
You can potentially earn a lower interest rate
In the event that your credit card carries forward an outstanding balance, you can potentially end up having to pay an annual percentage rate or APR that amounts to 20 per cent or more while those who have good credit could be faced with an APR of 12 to 17 per cent depending upon the card they own.
With a personal loan, on the other hand, the interest you would be exposed to would fall below 10 per cent. If you have a good credit score, this interest rate may even be lower. This implies that you could reduce your total interest payment in half and may even be able to pay back your dues earlier owing to the fact that your interest will be lower.
Streamline your payments by consolidating them
In the event that you pay a number of credit card payments each month, keeping track of each of them may be difficult in terms of the dates by which they are due and the amounts that are owed. By missing a payment you could incur late payment fees and witness a drop in your credit score.
Personal loans allow you to consolidate each of your credit card payments thereby leaving you to pay a single monthly payment 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, all in all, it can positively impact your credit score in several ways.
For starters, by availing 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 owing to you now having paid more towards your debt. The lower your credit utilization, the better your credit score.
While you might be hesitant about availing a personal loan, it may be in your best interest in order to maintain a good credit score and avoid late payment fees. Visit Finserv MARKETS today in order to learn more about personal loans with low interest rates.