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Why a Debt Consolidation Loan Could Be Right For You

What You Need to Know To Consolidate Debt

Did you know that only around 20 percent of Americans are free from debt of any kind? That means that 80 percent of Americans carry some kind of debt, according to the Pew Charitable Trusts. However, finding the right solutions to help you manage your debt can be tricky. Too many creditors and lenders can leave you with more questions about your debt than answers.

If your debt is getting out of control and you need help, you are not alone. There are many options that can help you gain control of your debt and get your life back. A common solution for handling debt is through debt consolidation loans. Debt consolidation can solve your credit issues, lower your monthly expenses, eliminate the stress of multiple monthly payments and give you control over your finances again.

Does debt consolidation sound like the solution you’ve been looking for? Greater Alliance is here to give you the answers to some frequently asked questions to get you started on the path to financial freedom once more.

What is a Debt Consolidation Loan?

A debt consolidation loan, or DCL, combines all your many debt payments into one. It’s used to pay off the balances on all your other accounts, and then make one manageable, monthly payment.Debt Relief at Greater Alliance

A DCL offers a lower interest rate than your current creditors, which can help you pay off your bills faster and save money that would normally get eaten as interest. Individuals who have many high-interest credit cards with high balances typically benefit the most from debt consolidation.

Greater Alliance allows you to apply online for a debt consolidation loan of up to $20,000 with flexible terms and no collateral required. In addition, you could receive up to $1,000 cash back from Greater Alliance when you refinance your personal or credit card debt with GAFCU from another institution.

What Types of Debt Consolidation Are Available?

There are four main ways to consolidate debt. These include home equity loans, credit card transfers, debt consolidation loans and personal loans. However, not all debt consolidation is created equal. Here is a brief explanation of different ways you can consolidate debt, and when it is best to use each.

Debt Consolidation Options

  • Home equity loans. If you have built up equity in your home, you may be eligible for a home equity loan. Interest rates are usually lower on a home loan; however, home equity loans put your entire home at risk if you are unable to pay back the loan. Most people are not advised to take out a home equity loan as a debt consolidation loan.
  • Credit Card Transfers. Credit card balance transfers move all your credit card balances onto one credit card with a low monthly interest rate. There is a caveat to take into consideration with credit card balance transfers: you’ll need an adequate credit limit on the card that takes on the accumulated balances.
  • Personal loans. These loans used to consolidate debt have fixed payments over a set period of time. The interest rate charged depends upon your credit rating.
  • Debt consolidation loans. Banks and credit unions offer these loans specifically for the purpose of consolidating and paying off your debt. These loans should offer a lower interest rate than what you are current paying creditors.

What Types of Debt Can Be Consolidated?

Most people have one or two main types of debt. The first is secured debt, which is a form of debt that comes secured in exchange for something, often called collateral. An example of secured debt would be a mortgage loan for a house or an auto loan for a car. Secured debt means that the creditors can repossess your collateral if the payments are not made.

The second category, called unsecured debt, is debt that does not require collateral. With unsecured debt, there is nothing that creditors can take away from you if you do not pay back your loans.

Typically, only unsecured debt can be consolidated. This unsecured debt might include student loans, medical bills, personal loans, credit cards, utilities and more. The most common debt used for loan consolidation, however, is credit card debt. Secured debt, such as home and auto loans, often cannot be consolidated.

Why Would I Want to Consolidate Debt?

There are many advantages to loan consolidation.

  • A debt consolidation loan allows you to roll all of your loans into one monthly payment, which can help you avoid the dreaded fees for incorrect amounts or late penalties.
  • Combining all your payments into one also allows you to better manage your payments. Greater Alliance Federal Credit Union allows clients to pick their own payment date, and members can set up recurring or one-time payments, or choose to have payments automatically transferred from their saving or checking accounts while setting up their loan.
  • A debt consolidation loan also decreases your monthly payments by reducing your interest rate. With loan consolidation, you can pay off those high-interest credit cards and commit to a lower monthly interest rate. Greater Alliance Federal Credit Union offers interest rates as low as 5.74 percent APR.
  • Since you are paying less in interest, consolidating debt gives you the potential to pay off your debt quicker than with your previous creditors. Lower interest rates from consolidating can save you loads of money, meaning that you can put your additional funds toward your debt faster than ever.
  • Debt consolidation can also give your credit score a boost. Paying off all those open credit cards helps your credit score by increasing your available credit, or improving your credit utilization ratio, which is the amount you owe compared to the amount of credit you have. Paying off your credit cards in full opens your line of credit, and you should see a jump in your credit score after just a few months.

Overall, debt consolidation is a great choice for many individuals because it offers lower interest rates, manageable monthly payments and a quicker payment period.

Is Debt Consolidation a Good Option for Me?

There are both pros and cons to loan consolidation. Although many people are successful with a debt consolidation loan, debt consolidation is not the right option for everyone. A debt consolidation loan might be the right choice for you if you have:

  • A steady source of income. A debt consolidation loan is not a quick fix. Keep in mind that debt consolidation rolled all of your payments into one single loan that still needs to be paid off. A debt consolidation loan usually takes three to five years to pay off, so your income should be steady enough to last the course of those years. Your income also needs to be stable enough to prove to your creditor that you can repay the loan.
  • A thought-out repayment plan. You should only agree to a loan after you know that you can afford to pay it off, not before. A debt consolidation loan is not a payment plan; it is only a way to help you manage your debt. Having a well thought-out plan for repaying your debt prior to taking out a new loan is the best way to be successful with debt consolidation.
  • Good spending habits. A debt consolidation loan can leave you feeling like you are free from debt, eliminating credit card and other monthly payments. If you pay off your credit cards in full using a consolidation loan, it might be tempting to look at all your available credit and get yourself into the same financial turmoil as before. For this reason, discipline and positive spending habits are crucial for the success of loan consolidation.

Does a debt consolidation loan sound like a good option for you? Apply for a consolidation loan today.

Debt consolidation might not be the best option for you if you have:

  • Co-creditors. If you have co-creditors that are also responsible for your debt and you take out a DCL by yourself to pay it off, then you are taking full liability for the re-payment of that money.
  • Poor spending habits. If you have poor spending habits and are prone to opening new credit cards after maxing out your old ones, then debt consolidation is not the right choice for you. Debt consolidation can increase your credit limit, but if not done correctly, you could find yourself in even more debt.
  • A higher interest rate. The point of a debt consolidation loan is to decrease your interest rate and to have more manageable monthly payments. If your new debt consolidation loan is has a higher interest rate than what you currently owe, that debt consolidation loan is not the right fit for you. It is important to research your loan options to find the best choice for you.

Contact Greater Alliance Federal Credit Union to learn more about the loan consolidation options that are available.

As you can see, debt consolidation might not be for everyone. To see if loan consolidation is the best solution for you, Greater Alliance Federal Credit Union has partnered with GreenPath Financial Wellness to work with our members to eliminate credit card debt. GreenPath has been helping members find solutions for more than 50 years. Contact a GreenPath counselor for free financial counseling and discover what options are right for you.

Why Was My Application for a Debt Consolidation Loan Declined?

If you applied for a debt consolidation loan and were declined, it could signal a greater financial issue that should be addressed. Here are a few situations when a debt consolidation loan could be declined, and how you should handle each:

  • Your credit score is too low. A poor credit score indicates poor spending habits and signals to lenders you are a high-risk borrower. Lenders are vary of individuals with a low credit score, and may deny your application for a consolidation loan or hike up your interest rate. Talk to a GreenPath Financial Counselor to find solutions to improve your credit score.
  • You have too much debt. A lender may deny your loan application if they feel you have too much debt and will not be able to repay the loan. To work around this, you will likely need to pay off a portion of your debt before considering a new loan.
  • You do not make enough money. When applying for a loan, creditors need proof that you will be able to repay the loan in full and on time. If your income is not high enough, creditors will doubt your ability to repay the loan and may deny your application. In this case, you may be better off with another debt solution over a debt consolidation loan.
  • You cannot provide collateral. Collateral would only be required if you are trying to consolidate debt that is secured, which is not a type of debt that is frequently consolidated. However, some creditors may require collateral if you have a low credit score. This secures your debt by providing something that creditors can liquidate if you do not repay the loan, ensuring that they do not lose money.
  • Your timeline of repayment is too long. Some lenders may only agree to a loan if you agree to pay off the loan on a short timeline. A prolonged payment period could be a discouraging factor for a lender. To address this, take a second look at the terms of your loan and see if you can repay the loan with a faster payment plan.

The best way to qualify for a debt consolidation loan is to take charge of your finances and pay off your debt before it gets too late. To find out if you are eligible for a debt consolidation loan, apply with GAFCU today. If you have been denied a debt consolidation loan, contact Greater Alliance Federal Credit Union to discover other financial solutions that may be available to you.

How Can I Get a Debt Consolidation Loan?

Debt consolidation loans are offered through banks, credit unions and online lending sites. Comparing lender’s interest rates, fees and payback period is important when deciding on a lender. Greater Alliance Federal Credit Union allows you to borrow any amount up to $20,000, and requires no collateral.

Before you decide to apply for a debt consolidation loan, think about your total debt and the amount you are currently paying. List your credit card and other monthly payments. What is your ability to pay off the loan each month?

Make sure the debt you are paying off is unsecured, as debt consolidation is usually geared toward unsecured debt.

Do your research on terms and interest rates before selecting a lender and taking out a loan. Make sure you speak with a trusted counselor who has your best interest in mind. Greater Alliance has partnered with GreenPath Financial counselors to offer members free financial counseling and assist them in finding the optimal financial plan for their needs.

Greater Alliance Federal Credit Union offers debt consolidation loans up to $20,000 with interest rates as low as 5.74 percent. Along with flexible terms and an easy, online application process, Greater Alliance can help you reduce your monthly payments and offers debt protection upon request. Greater Alliance Federal Credit Union, along with GreenPath Financial Resources, works together to find the best debt solution for you.

If you are ready to make your way out from under your mountain (or even a molehill) of debt, call us today. Greater Alliance Federal Credit Union has many resources available to assist you in finding your way out of debt. Apply for a debt consolidation loan today or call Greater Alliance Federal Credit Union to find the best financial solution for you.

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Debt Management Services

Debt Management with Greater Alliance

Learn about our free Personal Finance Management services and ways to improve your debt management and protect your credit.

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Money Management: A Family Affair When you develop your family budget and financial goals, involve the entire family. Including your children can teach them valuable money management skills.
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What To Do If You Miss a Payment Not all creditors handle delinquent accounts in the same way. Learn what steps you should take if you miss a credit card payment.

The Best in Financial Counseling….

Greater Alliance has proudly teamed up with GreenPath Debt Solutions, to bring you GreenPath, a free financial management program. Through comprehensive education and exceptional service, GreenPath has been assisting individuals for more than 50 years.
You can receive assistance with:

  • Personal and family budgeting
  • Understanding your credit report and how to improve your score
  • Money management
  • Debt repayment
  • Avoiding bankruptcy, foreclosure and repossession

Newsletter

GreenPath’s newsletters offers advice about budgeting, debt negotiation and debt management issues. You’ll also collect tips for saving money, protecting yourself from financial scams and for improving your life.

2018-  February

Free Financial Counseling

A GreenPath financial counselor will focus on the your concerns and needs to help develop a customized budget and a detailed action plan based on financial goals.

Debt Management Plan

A GreenPath counselor will help you prioritize payments, negotiate payment amounts and set up payment schedules with creditors. A counselor will thoroughly explain all options and applicable fees during the counseling session.

Housing Counseling

As a HUD approved housing counseling organization, GreenPath can help you with pre-purchase education, reverse mortgage counseling or foreclosure prevention issues.

Credit Report Review

A credit report review will help you evaluate your credit report, learn how to dispute inaccurate information and understand all aspects of credit scoring.

Education

Our main goal is to pave the way to a healthy financial future. The GreenPath website is loaded with tools and tips to use today and for life.

Here’s FREE, easy-to-use software to help you manage money more effectively.

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Click here to download it now!

CALL TODAY FOR A FREE CONSULTATION! 1-877-337-3399

Hours available:

Monday –Thursday 8 am – 10 pm (EST)
Friday 8 am – 7 pm (EST)
Saturday 9 am – 6 pm (EST)
Fraud protection

Fraud Protection

At Greater Alliance, we are committed to making sure your account is protected against fraud and that it is constantly monitored. With ever-changing technology, identity thieves continue to look for different ways to access secure information. Although we have the most recent technology and information to prevent fraud, you must also keep a constant eye on your personal and/or business accounts.

Greater Alliance takes online security seriously. We utilize numerous security layers and processes, which are continuously monitored and updated to maintain our security features.

Below are links to several different precautionary measures and steps you can take to make sure you have control of your own account and are prepared in the event that identity theft happens to you. Also included are links to information regarding current fraud trends and types of scams that could occur.

Debit Card Alerts

Sign up for Debit Card Alerts today and choose the alerts you want to receive!

You choose which types of account alerts you want to receive, how you want to receive them. Whether by text message or email, Debit Card Alerts help protect you from fraud by putting you in control of your account information. Standard text message and data rates assessed by your mobile carrier may apply.

Get Consumer Alerts for:
• Large purchases (you set the amount)
• Online purchases
• International purchases
• Card not present

This is a completely FREE option; register your DEBIT card today.

Register Debit Card

 

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Identity Theft How it HappensOur world is run on information and in this day and age information is as good as gold. Identity thieves have very crafty ways of getting at our personal info. Read more about some common methods.
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What Steps Should I Take If I Become a Victim of Identity Theft?Identity theft is a serious crime. Sometimes, victims can resolve the issue quickly with minimal damage to their personal finances and well-being. Other times, it can take several hours and hundreds of dollars to clear your name. Learn what steps you need to take if you become a victim of identity theft.
Seminars and Webinars

Seminars and Webinars

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Upcoming Webinars

Welcome to our educational webinar series. Please register for any upcoming webinars. All webinars are FREE of charge.

Webinar Wednesday – Couples and Money

Wed 4th – 12:00 pm With the holiday season quickly approaching, many couples will be spending more money than usual. Looking for ways to spend money wisely, avoid debt and save has never been more important – and many times more stressful – on relationships. Join us as we share productive approaches to managing money not only at this time but throughout the year. Sign-up here.

Webinar Wednesday – Budgeting for the Holidays

Wed Nov 18th – 12:00 pm Gifts, dinners, decorating, traveling? How do you keep track of it, and, more importantly, how do you pay for it? With the holidays approaching, this is the perfect time to review money management strategies and avoid the budget blues. Click here to sign up for our free gift to you!

Webinar Wednesday- Protect Your Identity

Wed Dec 2nd – 12:00 pm Identity theft cases are on the rise, and it’s more important than ever to protect yourself against identity thieves. In this webinar, you’ll learn what identity theft is, how thieves get and use your personal information, how to protect your identity. Sign-up here for this free webinar.

Webinar Wednesday- Saving to Achieve your Goals

Wed Dec 16th – 12:00 pm Are you trying to save money to buy a new house or car?  Do you want to save money for retirement or educational needs?  Would you like to have enough money in a savings account for emergencies?  During this time of year, it’s easy to lose focus of your goals and spend more money than you should. Click here to sign-up for this webinar.

Webinar Wednesday – Getting Financially Fit for 2016

Wed Dec 30th- 12:00 pm Being financially fit can be as important as being physically fit. Join us for our last webinar of 2015, as we share some tips and tricks to get you in the best financial shape possible in 2016. Click here for this free webinar.

Upcoming Seminars:

We are currently not offering any seminars. Please check back at a later date.

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Auto Loans

Why finance your car loans with Greater Alliance?

Whether you are in the market for a new or used car, truck, boat or RV, Greater Alliance auto loans get you further down the road to financial freedom.

auto-icon-small  For both new auto loans or used auto loans, we offer:

  • Competitive rates as low as 2.24% APR*
  • Flexible terms up to 48 months, or longer upon request to lower your monthly payment even further!
  • Fast approval process
  • Up to 100% financing available, including sales tax and extended warranty
  • No down payment may be required
  • No pre-payment penalty
  • Payroll deduction or automatic payment options available

Already have a high-rate car loan?

Refinance your car loan with Greater Alliance and get the same low rate as our new and used car loans for qualified buyers, plus receive  1% Cash Back, up to a $1,000!

First time buying?  Our First Time Auto Buyer Program is designed for those who have little to no credit but are ready to purchase their first vehicle.

These auto loans come with low rates and manageable terms and are an excellent way to establish a credit history.

Apply Now

auto-icon-small Your One-Stop Auto Loan

Come to Greater Alliance for smarter ways to find, fund and insure your car, truck, boat or other vehicles. In addition to our great auto loans, we strive to make all aspects of car ownership more affordable and less frustrating by offering a variety of vehicle services designed to help you save time and money.

Before You Buy:
  • Not sure how much car you can afford? Find the dream car that fits your budget using our auto loans calculator!
  • Auto Buying Center: Find and finance your next car all in one spot. We can pre-approve you for a loan while you search through local dealer inventory. Plus, you can get side-by-side comparisons of vehicles to see how they measure up.
  • Enterprise Car Sales: A worry-free way to shop for used vehicles. Over 250 makes and model for you to choose from.
  • When you’re shopping for a car, is it better to lease or buy? Check here for great advice on leasing vs. buying.
Before You Get on the Road:

Apply, sign and receive your loan electronically with docusign_logo_3c-300x84

Greater Alliance offers convenient and secure electronic loan processing with Docusign Virtual eSignature.  Learn more!

Skip Your Auto Loan

Our Skip-a-Pay service will offer you the convenience of skipping your payment on any qualifying Auto loan. You will be able to skip payments quickly and securely, 24 hours a day, 7 days a week. Learn more!

Skip Now

auto-icon-small Auto Loans from Greater Alliance – Just A Click Away!

Why wait any longer to get in the vehicle of your dreams? If you’re a member, apply now!

If you’re not a member, it’s easy to become one. Click here to get started. Membership requires only $175 in a savings account.

You can also call us at us at 888-554-2328 x290 or stop by any Greater Alliance branch locations.

Apply Now

*APR = Annual Percentage Rate. Lower rates may be available to qualified borrowers who open a checking account with payroll deduction or direct deposit. Advertised rate is subject to individual qualifying factors and subject to change without notice. For longer terms than 48 months, rate will be 1% higher than this offer. Loan available only to credit union members; membership in the credit union requires a minimum balance of $100.

 

 

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Home Equity & Mortgage Loans

Mortgage Loan Products for every Place in your life

Greater Alliance has full range of mortgage loans and home equity loans to fit your needs.

Whether you are a first-time home-buyer, remodeling your dream home or looking to refinance a higher-rate loan, you’ll benefit from:

  • Low fixed and adjustable rate options
  • Multiple terms available
  • Free pre-approval, giving you the buying power to shop around at a price you know you can afford
  • Loans for just about any kind of dwelling, including condominiums, single family, multi family, second/vacation homes and planned unit developments (PUD)

Fixed-Rate Mortgage Loans

Fixed-Rate Mortgage Loans are best for those who want the stability with the same monthly payment for the duration of the loan.

  • Low rates and flexible terms of up to 30 years
  • No Application Fee & Rate Lock-In Fee
  • Available in any state
  • View Rates

Adjustable Rate Mortgage Loans

Adjustable Rate Mortgage Loans give you more buying power for your home.

  • Start with a great initial rate
  • Adjusts once every five years
  • No Application Fee & Rate Lock-In Fee
  • Available in any states
  • View Rates

Both our fixed rate and adjustable rate home loans offer attractive options for refinancing your mortgage from another financial institution, to help you pay your loan off sooner, lower your monthly payment or consolidate debt. Of course, our loans are also ideal for that new home purchase!

Apply Now

You can also call us at 800-963-1937 or visit any branch location for more information. If you have questions before you begin, complete the form below and one of our mortgage representatives will contact you.

First Time Home Buyer Program

Greater Alliance has partnered with Fannie Mae to offer an innovative way to unlock your potential as a first time home owner. The Greater First Time Home Buyer Program is ideal for you:

  • If you are a moderate or low income mortgage loan borrower
  • If you are looking for flexible mortgage loan credit criteria
  • If you want or need down payment assistance and low mortgage loan rates.

Learn More

Home Equity Loans to Finance Your Life

Easily finance just about anything you want or need. Home equity loans are the right choice for:

  • Home improvements
  • Consolidating high-interest debt
  • Paying off medical expenses
  • Paying for higher education
  • Taking that much needed vacation
  • Funding a wedding or other high-ticket plans!

With our Fixed Term Home Equity Loans, you can borrow up to $250,000 to be paid back in equal payments, for up to 20 years.

  • Rates as low as 3.49% APR
  • No closing costs in most states*
  • No annual fees
  • Interest may be tax deductible (Please consult your tax advisor for information.)
  • Receive 1% Cash Back up to a $1,000 when you refinance your existing loan from another financial institution with us

*We service home equities in the following states: NJ, NY, CT, PA, FL

Apply now for a Home Equity Line of Credit (HELOC), at a rate as low as 1.99% APR*. A HELOC works as a revolving line of credit so you’ll have the funds you need, when you need them, to help make those big changes in your life a success. It’s easy and secure, and you only have to pay interest on what you actually use!

Apply Now

Skip Your Fixed Home Equity Loan

Our Skip-a-Pay service will offer you the convenience of skipping your payment on any qualifying 5, 10, 15, and 20 Year Home Equity loan. You will be able to skip payments quickly and securely, 24 hours a day, 7 days a week. Learn more!

Skip Now

You can also call us at 888-554-2328 or visit any branch location. If you have questions before you begin, complete the form below and one of our loan representatives will contact you.

Home Equity and Mortgage Loans Resources

Let Greater Alliance be your first – and last – stop in the home buying process. Our mortgage resource center puts all the tools you need right at your fingertips, to help you make decisions and keep the process trouble-free.

  • Let us keep an eye on interest rates so you don’t have to. With Rate Watch, we’ll e-mail you when rates reach your goal or current rate information on a regular basis.
  • Use our mortgage calculators to help determine if you should rent or own, how much home you can afford, or whether you should refinance.
  • Greater Alliance members benefit from discounted rates on Home Insurance, ADT and Direct TV.
  • The Greenpath Financial Wellness Home Center gives you great tips for going green at home and other timely information for homeowners
  • Not quite ready to own? Why not start saving more today with a Greater Alliance savings account or certificate account?
*APR – Annual Percentage Rate. This promotion is available for a limited time and may be withdrawn at any time. The promotional Annual Percentage Rate (APR) will not change until the first day of the 13th month after the day of the loan closing. After the introductory period, the loan will become a variable rate loan and the interest rate and payment may change. The prime rate is based on the highest prime rate published in the Wall Street Journal. On January 1, 2018 that prime rate was 4.50%. The current APR for a Home Equity Line of Credit using the prime rate minus 0.26% margin is 4.24%. The floor rate at the end of the initial 12 month period will be 2.99%. The APR will never exceed 8.99%. If applicable, your payments will change on the first day of the month. At no time during the life of your loan will your interest rate go below 2.99% after the one year introductory rate, nor will it go any higher than 8.99%. Your annual rate change per year cannot exceed 2.00%. You can select a term of 20 years with a “draw period” of 7 years. Other restrictions may apply. Some Non-NJ Properties may have State Tax related closing costs. If the loan is paid off within two years, the borrower agrees to reimburse the Credit Union for closing costs initially waived in the amount of $750, and that the member authorizes the Credit Union to withdraw the money from their Credit Union account. Loan Rates and current offer are subject to individual qualifying factors and may change at any time without notice, your rate may be higher. Minimum line amount of $25,000. Maximum line amount of $250,000. Loan amount is up to 75% of your home’s value less any other liens. This promotion applies only to new lines of credit and is not available to refinance existing loans with GAFCU. Promotion available for single family, owner-occupied, primary residence only; excludes investment property, second and vacation homes, condos, co-ops and single or double wide manufactured homes. Property insurance is required. Applicants must successfully meet our Home Equity Line credit standards. Not all members will qualify for this promotional offer. Alternative rates and terms are available. Some Non-NJ Properties may have State Tax related closing costs. **Consult your tax advisor regarding your ability to deduct Home Equity Loan interest. Credit union membership required to apply for any of our products and services.