Do you feel like you'll never be able to get out of debt? Don't worry, you're not alone. In fact, there are more and more people who are feeling hopeless and helpless when it comes to their financial obligations. At this day and age when prices are surging and prices of homes have gone up, indeed, it's getting more difficult to balance income with expenses. Worse, there are already several who can no longer manage all their bills and thus go on default.



Fortunately, there's a way out, and it's called debt consolidation. This means that you can eventually combine all your existing debts into one, so you don't have to think of different payment schedules and interest. There are even some more benefits that you can derive from it, such as better rates for your interest, tax deduction, and longer payment term. But do you know that you have actually so many ways to consolidating debts?

1. Take advantage of the zero percent interest rates of credit cards. Perhaps unknown to you, your credit card company can also help ushering the debt consolidation process by making sure that you don't incur any interest once you transfer your balance or amount due to a different and new account. However, you have to be very careful about this. These days, you will only be entitled to use this as long as you can apply for such transfer between 6 and 15 months. Otherwise, you will begin incurring interest rates for this. You also have to monitor the fees that you have to pay in relation to the transfer. Usually, it's going to be pretty high, and you need to evaluate if it's something that you want to pay just so you can proceed with debt consolidation. This is also not excellent if you're looking for long-term options in fixing your credit card debt.

2. Go for unsecured loans. Some financial institutions can offer unsecured personal loans for individuals who want to go for debt consolidation. This is also ideal for people who already have bad credit rating or those who can't put up any equity or collateral for the loan. This is because in unsecured personal loan, you don't have to present anything except perhaps the bills that you want to be consolidated. Nevertheless, this pose such a great risk to the lender, as there's huge possibility that you won't be able to pay. Hence, debt consolidation through this method can have very high interest rates, and terms for the loans are shortened.

3. Choose between two types of second mortgages. Another option in consolidating debt is going for a second mortgage. You have two choices for this. One, you can opt for a HELOC, or a home equity line of credit. This means that you can borrow money equivalent to the equity value of your home. The second one is a fixed-rate mortgage. Either way, both can allow you to lower the size of your loan as well as the payment terms, which means you will also be spending less on your interest.