Different Methods of Debt Payments

Using the debt facility from the Bank/NBFC today is very easy. Once you fulfill the eligibility criteria, the lender can provide you with a personal loan, car loan, business loan, home loan and a loan against property. You can also avail the facilities of plastic money i.e. a Credit card. As per your credibility, the lender provides you the debt with a certain rate of interest. For a credit card, you get a monthly bill and pay the “minimum amount due” and transfer the remaining owed amount to the next month’s bill or you repay the whole bill.

But what happens when you have multiple debts?

Let’s take a scenario including multiple credit cards. It might be a possibility that you own multiple credit cards. You use them frequently and now are having a tough time to clear all the bills. The amount is very huge and life is getting tough. There is a lot of pressure on you to be clear and save your credit score from decreasing. The only way you can try to clear these payments is through these 2 methods;

You can choose to pay the minimum amount due of all the credit cards. Along with that you can use the remaining funds to pay the smallest bill. This process is long term. In time, you will slowly clear the smaller debts. This will allow you to utilize more money on other debts. Clearing every small debt is motivating and allows you to be clear of all the debts.

You can again choose to pay the minimum amount due of all the credit cards. A long with that you can utilize the remaining funds to pay the one with the highest debt. This process is short term. In time, you will clear off all the bigger debts. This will help you save more money. Discipline is a big necessity here.

Hence, you can choose any of these two methods as per your requirement and accordingly clear all the payments. To know more about how you can apply for a credit card

Pin It on Pinterest