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Credit card consolidation loans are among the most common types of lending taking place today. Often times I read about people that have multiple cards at 20% - 30% interest rates. Even for cards at lower rates, depending on your credit, getting a consolidation loan is a great idea, and Prosper can help.

If you have a significant amount of credit card debt things can begin to spiral out of control with bills piling up. The money going to finance charges on credit cards eats up income needed for other important things and as you pay small amounts every month, it can look like you will never get out of credit card debt. This is why a credit card consolidation loan thru Prosper can help.

Prosper is an online marketplace like Ebay, except for loans. You post a loan request and people bid on your loan until its funded. If your loan gets funded early, the interest rate can go down as lenders start to bid lower and lower on your rate.

For a variety of reasons, its hard to pay off your balances every month. While credit cards can be convenient and credit card providers are very willing to give you cards, the interest rates they charge are often much higher than average.

If you have excellent credit, you can get a Prosper loan from as little as 7% or 8%. If you are paying 20% interest now, you can save a lot of money and pay the balance off much faster.

For example, if you owe $10,000 and are paying 20%, you are paying $2,000 a year in interest. Just to service this debt, you must pay almost $170 a month in interest! You have to pay more just to lower the balance.

But let’s say you got a Prosper loan at 9% to consolidate the debt, that would mean you would only need to pay $75 in interest, a savings of almost $100 a month in interest. This can have a huge impact on how quickly you get out of debt.

Prosper loans are amortized over 3 years. You can make payments any time you want, and you can pay the loan off early without any extra fees. Prosper is also a very safe place to borrow money.

2 comments:

At January 20, 2008 at 6:43 AM Anonymous said...

Hey ProsperBlogger- I thought you might enjoy my new blog, KyleMStephens.com. I poke a little bit of fun at some of the Prosper listings. Enjoy!

 
At January 22, 2008 at 2:12 PM Anonymous said...

Nice blog, could use some consolidation!!!

 

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