Financial Restructuring… Again!

Debt Consolidation, Again!

I have taken out a second loan of $12,000 to pay off our credit cards, from American Express at 9.99%, because the amount of interest being charged, which comes to almost $200/month, with the majority of that, $119 coming from my wife’s Discover which had a $6,300 balance and a 22.24% interest rate.

I wasn’t thinking of getting a loan, but when I logged into to make my payment, a popup message offered me a loan of up to $25,000 at an interest rate of just 8.99%. I was intrigued enough to investigate and ended up applying for a $12,000 loan over 48 months at an interest rate of 9.99%, a little higher rate because I elected for 48 months, not 36 months for smaller payments. This combines 4 separate payments and interest charged will be $54.24/month and a payment of $304.30.

I didn’t need all of the $12,000, the actual balances owed was $11,000, but I know that the trailing interest is coming. I fell foul of this last time I took out a loan to pay off credit cards. I expect the trailing interest to be around $150 in total, the remainder will be used for a hotel when we see Korn in Denver.

Overall, we will be paying less, a saving of roughly $150/month and more of our money will be going to the principal balance, meaning we have more money in our pocket and the balance will be paid down at a much faster rate. Combined with a good chunk of that loan being paid down at tax time, maybe $3,000, we should be free and clear within two years,  that is, if wifey can control her credit card spending.

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