| Borrowing money from a bank or lending institution can | | | | Still, while these programs can be beneficial to |
| help one achieve personal and financial opportunities | | | | borrowers, there are pitfalls to avoid. After all, the |
| that may not otherwise be feasible. However, without | | | | reality is that consolidation programs shift debt - they |
| proper knowledge and discipline, borrowing can get a | | | | do not eliminate the debt. Borrowers still owe the |
| person into trouble. When it comes to borrowing, being | | | | money and it will have to be paid back sooner or later. |
| an educated consumer may save a lot of headaches | | | | One potential pitfall is that borrowers may feel that |
| and plenty of money. | | | | there is less outstanding debt. For example, a person |
| To ensure access to the best loan rates and credit | | | | may notice that credit cards once again have |
| opportunities, keep these tips in mind: | | | | generous amounts of available credit. If this credit is |
| Pay bills on time. | | | | used, it is possible to dig into an even deeper debt hole. |
| Late bill payments create creditor concerns. Enlisting | | | | Use loan amortization calculators to plan for success. |
| handy devices like online bill pay services help keep | | | | A loan amortization calculator is intended to show how |
| one's life organized and make bill paying easy. | | | | a loan will work month-by-month. The calculator helps |
| Be responsible with revolving credit. | | | | determine how much interest will be paid over the |
| Revolving credit is open-ended credit, similar to a basic | | | | years, and how much of the balance is paid off at any |
| credit card. This type of credit gives the opportunity to | | | | given time. |
| spend whenever more money is needed or desired, | | | | An online loan amortization calculator includes an |
| as opposed to staying within one's budget. | | | | amortization table for reference. After filling in |
| Furthermore, borrowers should be concerned about | | | | information related to a loan, the calculator tabulates |
| the sometimes high interest rates attached to revolving | | | | results in a textbox below the loan amortization |
| credit. | | | | calculator. |
| Be prompt in responding to creditors' phone calls. | | | | Look further than APR to choose the best loan |
| Responsible borrowers stay in communication with | | | | Some consumers make the mistake of comparing |
| their creditors - especially if they encounter trouble | | | | loans by only looking at the APR. Borrows should keep |
| making a payment. It's a good idea to take a proactive | | | | in mind, however, that not all lenders calculate APR the |
| approach when it comes to maintaining good credit. | | | | same way. Some may or may not include all the loan |
| Review credit reports. | | | | costs. For example, the credit report fee, appraisals |
| Since the U.S. government offers a free annual credit | | | | fee, and inspection fees may not be included in an |
| report program, there really isn't any excuse to leave | | | | APR quote. Furthermore, because various lenders can |
| credit reports unchecked. | | | | charge different credit report fees, the APR |
| Be Smart about Debt Consolidation Programs. | | | | comparison becomes less valuable. Customer-focused |
| With many U.S. consumers carrying significant credit | | | | lenders may actually include more fees that accurately |
| card debt, debt consolidation programs are in high | | | | reflect a borrower's circumstances, which may make |
| demand. The programs are typically a large loan that | | | | their APR appear higher. Therefore, focusing solely on |
| pays off other smaller loans. With consolidation, | | | | APR is not the best way to shop for a loan. |
| monthly statements and payments are typically | | | | Overall, to choose the best loan, it's helpful to look at |
| reduced. In addition, if strapped for cash, a debt | | | | each lender's quote closely. One should take time to |
| consolidation program may stretch payments out over | | | | review the rate and closing costs - not just the APR - |
| a longer period of time - decreasing monthly debt | | | | and note carefully which costs are excluded. |
| payments. | | | | |