Stark Federal Credit Union

Blog

Woman looking stressed out and biting on a pencil while looking at her laptop screen

What do I Need to Know About Debt Consolidation?

Q: Help! I’m drowning in debt! I’ve heard about debt consolidation, but what do I need to know before moving ahead?

A: Debt consolidation is the process of moving multiple high-interest debts into a new loan or line of credit.

Here’s what you need to know about debt consolidation.

What are the benefits of debt consolidation? 

Saving on interest payments. Moving your debts to a new loan or credit line with a low-interest rate can translate into big savings.

One monthly payment. Say goodbye to scrambling to keep track of and make all your monthly payments!

Fixed payment timeline. How does knowing when you’ll be debt-free sound?

Boost your credit score. Amp up your score with a balance transfer or loan.

What are the disadvantages of debt consolidation? 

May stretch out the payment timeline. More time in debt? No thanks.

Won’t eliminate irresponsible spending habits. You won’t turn into a budgeting beast just because you’ve relocated your debt.

A lower interest rate may not last. Many low- or no-interest credit cards only offer these features as a temporary promotion. Once time is up, the high-interest rates hit. Ouch!

How can I consolidate my debt?

1. [Personal/unsecured] loan — This will allow you to pay off all your outstanding loans immediately and move your debts to one low-interest loan.[Personal/unsecured] loans usually have origination fees and other charges. Also, the interest rates on these loans can be sky-high.

2. HELOC — Use your home as collateral for an open credit line.

The drawback here is that you risk losing your home if you don’t pay up. Also, repayment terms can be upward of 10 years.

On the flip side, interest payments on HELOCs will be affordable and possibly tax-deductible.

3. Balance transfer — Move your debt to a new credit card with a low-interest rate or a zero-interest offer.

The disadvantage of putting more plastic into your purse is that you may rack up a new credit card bill. Also, low interest or no interest may not last.

Stark Federal Credit Union
NCUA

Dressler Branch
4100 Dressler Rd. NW
Canton, OH 44718
Office: 330.493.8325
Fax: 330.493.8328

Loan Dept.: 330.493.7602
Loan Dept. Fax: 330.493.1619

Mon. - Fri.
9:00 a.m. - 5:30 p.m.
Sat. 9:00 a.m. - Noon
(Drive-up only)

Cleveland Ave. Branch
3426 Cleveland Ave. NW
Canton, OH 44709
Office: 330.493.8326
Fax: 330.493.8941

Mon. - Fri.
9:00 a.m. - 5:30 p.m.
Sat. 9:00 a.m. - Noon

Alliance Branch
1281 S. Sawburg Ave.
Alliance, OH 44601
Office: 330.821.7225
Fax: 330.821.2004

Mon. - Fri.
9:00 a.m. - 5:30 p.m.
Sat. 9:00 a.m. - Noon

Minerva Area Federal CU Shared Branch
(Cash and deposits only)
3570 Union Ave. SE
Minerva, OH 44657

Mon., Tues, Thurs.
9:00 a.m. - 5:00 p.m.
Wed. 9:00 a.m. - 1:00 p.m.
Fri. 9:00 a.m. - 5:00 p.m.

Routing Number
241274598

Copyright © 2023
Stark Federal Credit Union
All rights reserved.

Home Banking Login ID

Enter your banking login ID into the field below to access your account.
New to online banking? Click here to enroll now.

You Are Now Leaving Stark Federal Credit Union

The link you clicked will take you to one of our partner websites. We don't control the content of our partner sites. Please review their Privacy Policy as it may differ from our Privacy Policy. We hope you found the information you were looking for from Stark Federal Credit Union.

You Are Now Leaving Stark Federal Credit Union

The link you clicked will take you to one of our partner websites. We don't control the content of our partner sites. Please review their Privacy Policy as it may differ from our Privacy Policy. We hope you found the information you were looking for from Stark Federal Credit Union.

You Are Now Leaving Stark Federal Credit Union

The link you clicked will take you to one of our partner websites. We don't control the content of our partner sites. Please review their Privacy Policy as it may differ from our Privacy Policy. We hope you found the information you were looking for from Stark Federal Credit Union.

You Are Now Leaving Stark Federal Credit Union

The link you clicked will take you to one of our partner websites. We don't control the content of our partner sites. Please review their Privacy Policy as it may differ from our Privacy Policy. We hope you found the information you were looking for from Stark Federal Credit Union.

You Are Now Leaving Stark Federal Credit Union

The link you clicked will take you to one of our partner websites. We don't control the content of our partner sites. Please review their Privacy Policy as it may differ from our Privacy Policy. We hope you found the information you were looking for from Stark Federal Credit Union.