If Taft Financial A Good Option To Pay Off Your Credit Cards?
If you have been thinking about it and you just received a “too good to be true” loan offer in the mail from Taft Financial – listen to your gut instinct.
Companies like Taft Financial, Georgetown Funding, Memphis Associates, Patriot Funding, Tate Advisors, Plymouth Associates, Tiffany Funding, Simple Path Financial, Americor Funding, Credit 9 or Titan Consulting Group, have been flooding the market for years with questionable loan offers and the results are not good for consumers.
Crixeo’s debt consolidation reviews have been reporting on bad actors in the credit card industry for years.
Credit cards are a useful convenience to help pay for things when you do not have cash or simply want to purchase something on a whim but do not have the monetary funds to do so. However, very often, this convenience can cost you. Credit card debt is a problem that millions of people suffer with, which can often be frustrating to deal with.
Credit cards do not always have to be a vicious cycle of debt or a trap; it can continue to be a helpful convenience for you as long as you use it smartly. There are numerous ways of getting out of credit card debt; all you have to do is explore the available options around you and decide which is most suitable for you based on your financial situation. Here are some of the ways you can protect your finances and pay off your credit card debt.
Can You Pay Your Credit Cards With Another Credit Card?
The short answer to this question is no. Banks do not allow you to pay your credit card with another credit card because it would lead to a never-ending cycle of debt. This is why banks typically accept checks, cash or electronic bank transfer.
However, paying your credit card debt by using another credit card is not entirely impossible either; there are two loopholes. But you must be aware of the terms, consequences and limitations beforehand. These two include using balance transfers and cash advance.
Using Balance Transfers to Pay Off Credit Card Debt
The loophole to using a credit card to pay off another credit card is through balance transfers. However, it will likely take some time for this process to come to fruition. The only time you can use balance transfers to pay off a credit card is when you are moving your credit card balance from a high-interest credit card to one with a lower rate or a 0% introductory APR.
Thus, this option becomes useful when you are consolidating debt from a high-interest credit card to one with a promotional 0% APR. However, it can become tricky to use if you do not know the basics.
Some of the drawbacks of balance transfers are that you lose all the promotions and favors you were previously enjoying when you miss a monthly payment. Additionally, their transfer fee may be high to pay.
Moreover, balance transfers are not the most favorable method for people who can only afford minimum monthly payments. And if they lose their jobs, it may put them in a worse situation than before as they will be in a dead-end.
When you transfer your credit card balance to a card with lower interest, you can save money. Here is how you can transfer your credits:
Request the Balance Transfer
Take some time to research which credit card companies are offering a 0% APR. They usually offer these in their promotional deals. You can request a balance transfer to them either online or by directly calling the new card issuer. Most often, the process is pretty simple and straightforward as they typically guide you themselves.
Transfer Processing and Approval
The time for approval might take up to two weeks. The issuer of the new card usually pays your credit card debt and then notifies you. After this, you will have to pay the transfer fee, usually between 3-5% of the transferred fee.
Start Paying Off Your Balance
This is when you must begin paying off the new credit card’s balance because the initial period is the only time you will be paying at 0% APR. Otherwise, after this period, the issuer will also start charging interest.
A cash advance is when banks allow you to take the money you need to pay your debts. It involves going to the ATM and withdrawing all the cash needed to pay back the debt and pay the credit card bill. It lets you get the cash as quickly as possible, which you can use to pay off the debt with a much higher interest rate. Though this approach is quite straightforward, there are some lesser-known disadvantages to it.
For example, a cash advance can increase your balance because of the accompanying fees, which is typically 5% of the amount you withdraw. Secondly, it includes a significant amount of financial risk, which is much larger than that in balance transfers. They include an increased interest rate and may be detrimental to your credit score.
Therefore, it is important for you to do the math and know all the costs before you take the route of cash advances so that you do not end up in more financial trouble.
You can consolidate your credit card debt by taking out a loan, which typically includes a lower APR, though you will still have to pay an introductory APR rate. Nevertheless, this method will let you save money in the long run.
A Credit Counselor
This should be your last resort if things start getting messy and you feel overwhelmed and cannot handle the financial burden. They will analyze your financial situation and determine which approach is best for you and then guide you with it.
The Bottom Line
Whatever approach you take to tackle your credit card debt, it is important for you to first reduce your spending and control your spending habits. If you continue overspending, you will find yourself in deeper financial trouble, and neither balance transfers nor cash advances will be helpful for you.
Calculate how much you spend per month from your income, determine how much you can save, and then create a budget for yourself. This will also help you decide which approach is more suitable for you. A smart financial decision would be to start paying a debt that has the highest interest rate and then move downwards. This will help you save hundreds of dollars in the long run and pay off debts much faster.
Remember – avoid the financial scams that you receive in your mailbox.