Personal Loan vs. Credit Card Debt

Personally, I would tackle the current card situation with the snowball method. I would do this because I might be tempted to continue adding to credit card debt if it were back at 0$, and because I have seen time and time again clients of mine do that very thing. 

So yes I realize that the interest rate is higher. But personally, that is what I would do, and what I did do. 

@KellyFromKeene That's totally fair! I don't think I'd be tempted to spend with the balances down, but I realize that life happens and it's not a guarantee. (Or else I probably wouldn't even have considered the loan idea.) 

The snowball method is what I'm doing for now, but I'm hoping once a card or two are paid off, I can focus on the highest interest rate. Hopefully the combination of momentum and fighting back the interest will prove successful!

My husband & I just consolidated our credit card debt with a personal loan. My first advice is to go to a bank (credit union preferably) to seek your personal loan options there. Upstart gave us interest rates around 18% as well, but our credit union was able to give us a rate of 7.99%! However, depending on if you own a home, a home equity line of credit is another option. You are in a similar debt situation as we were - the amount is not crazy huge, but it can seem daunting when you are charged 25%+ interest every month. 

This move will save us thousands in interest for basically the same monthly payment. It also gives us something that my husband values -- a light at the end of the tunnel! Our loan is for 3 years, with no early payoff penalties, so we are shooting to pay it off in 2 years. 

Credit card debt can seem endless; the snowball method is great & works for some people, but not everyone. I'm so glad we made the move to get the personal loan! 

I personally took out a loan with Upstart because the interest rate was lower and the money I would save just in that would help me.  I haven't charged on my CC but it is tempting to.  You have to remind yourself over and over not to. I gave one card to my sister just in case and other's I froze them. 

@A.Gonzalez I bank with a credit union and I'm kicking myself a little. They sent me information about a personal loan a couple months back, but I didn't inquire more! The "promotion" or whatever it was seems to have ended, so I'm not sure what they've got now. Maybe'll I'll ask sometime soon. 

I very recently purchased a house, and I won't lie that I have NO IDEA what I'm doing or what half of the paperwork means. Since it was only back in August, I didn't think I should do much until everything is better established, if that makes sense.

@MountainFan If you just purchased your home in August, you don't have enough equity into it to do a home equity line of credit. Basically a HELC leverages the money you've paid into your home already (your "equity") & lets you borrow against that. I'm not an expert on this stuff by any means, but that's how it was explained to me.

As for your credit union - it's worth asking about! We sat down with someone & asked all of our questions (my husband had a LOT lol) before even starting the application, so you can always weigh your options before taking the hit to your credit score of a loan application. 

I think the hardest adjustment for anyone trying to pay off credit card debt (at least this was true for me) is considering that CC as untouchable & living solely within the means of your cash inflow. I do like the suggestion of giving one of them to a friend/ family member to save yourself the temptation... I might try that one myself! 

Good luck!!!! I hope you find whatever works for you! I'm on the same journey

To A. Gonzalez I'm interested in knowing what questions your husband asked in regards to the loan. I have less than $3000 in credit card debt, but my debt to credit ratio is high (if I said that correctly). Anyway, I want to consolidate because the interest rates are eating up any payments I'm making, so the principal just increases. 

@Melanie T his questions were related to our options (home equity, personal loan, secured loan, & the various choices within each), terms (we got it for 3 years), fees (no early payoff fees, standard late fees, etc), how it will affect our credit (a net improvement - we'll get dinged for the credit inquiry & for having a "maxed out" line of credit, but we'll show 2 cards getting paid off in full & for having a set loan instead of open line of credit), etc... he basically just wanted to know what we were getting in to.

In your case, have you thought about getting a balance transfer card? Your CC debt is so small, you could get a card that has a 0% intro APR on balance transfers, & as long as you pay it off within the terms, you'd have 0 interest. Intro periods are anywhere from 12 months to 20 depending on the card, so you have to decide if you can meet that payment every month because it is a shorter period than a loan would be. For example, a balance transfer card with an introductory period of 18 months for a total transfer of $3K would mean you'd pay $166.67 every month. Also, you'd have to be disciplined enough to not use any of the credit cards! but it's another option to consider. 

thanks for all the input i enjoy learning from you all, i don't have any credit card debt, i am greatful for that

Thanks for all this input and my credit Union had a special rate of 3.99% for 24 months and then 12.99% after that and on any new purchases it will be 12.99%. I auto pay $200/mo on the debt of about $2200, and trying not to charge anything else