Looking for ways to reduce or consolidate your mounting debt? We detail two options that charge a lower APR and can eliminate fees when using them.
Ready to slay the debt monster? If you're looking to ease your debt, and ultimately eliminate it altogether, switching your debt to a loan with lower interest makes it easier to pay off what you currently owe. Why?
- The higher your interest rate, the more you pay over the life of your loan, making it difficult to get out of debt
- The less you pay in interest, the more you may be able to pay on the actual amount owed, potentially shortening your repayment period
Determine the impact on your debt when you eliminate interest on your payments with this debt-calculator. Now that you know why a better interest rate can help you get out of debt, consider these two options: a low-rate credit card with 0% introductory APR for the first 12 months on balance transfers1, and a no-fee home equity line of credit2. Let's explore what BECU offers.
Low-Rate Credit Card
Why Choose This
- One of the lowest rates in the nation
- 0% introductory period for the first 12 months1 on balance transfers and purchase, after which your rate will be 7.99%-19.99% APR (credit cards adjust to the current prime rate)
- No balance-transfer fees
- No equity in a home needed
Take a look at the rate you're paying now, then compare it to the current rate that BECU charges . As a not-for-profit credit union, one way BECU returns profit to members is its better rates: Does BECU offer a better rate than your current card? If so, you may be able to save by switching. And, if you do switch, there's no fee to transfer your balance.
Things to Consider
After the introductory rate on your BECU credit card ends, your rate will be between 7.99% - 19.99% APR. Though a lower rate than other credit cards in the market, it is higher than a loan secured by a home such as a HELOC. And with credit cards, you can only transfer for the amount that you're approved. If you are approved for $10,000 and owe $15,000, and are looking for a lower long-term rate, you may want to consider using a HELOC instead if you own a home.
Home Equity Line of Credit
Why Choose This
- Low rates on fixed- and variable-rate options
- No origination fees2, which means no application or closing fees
- Larger amounts available based on the equity in your home
- Borrow only what you need by simply transferring funds to your checking account
A home equity line of credit, or HELOC, is also a great option for reducing debt. As a homeowner, you'll find that HELOC rates are typically lower than a credit card because the loan is tied to the equity, or value, in your home. How so? A property, not an individual, secures the loan. Once your HELOC funds, you even have the option of "locking" in, or fixing, the rate on loans greater than $5,0002. You have the peace of mind that your rate remains the same no matter the current prime rate.
Things to Consider
The loan is tied to your home, so if you miss payments, it could affect your home ownership - a risk some homeowners choose not to take. HELOCs are also tied to the current prime rate meaning if the prime rate adjusts, you could see your revolving HELOC rate change. And, unlike a credit card, with a fairly unlimited repayment period, a BECU HELOC requires you to pay back the debt within a 15-year time-frame after the 10 year draw period ends.
The variable APR ranges from 3.34% - 8.34% APR as of 4/1/2020. The Fixed Rate Advance (FRA) rate currently ranges from 4.59% - 9.59% APR as of 4/1/2020. Rates depend on credit worthiness (the maximum APR for both advance types is capped at 18%).
Why Choose This
Personal loans are disbursed in a lump sum, and require no application fees and no collateral. Borrow up to $15,000 for small expenses or to consolidate debt. With an easy application process, flexible repayment terms and easy online account access, a personal loan could be the right choice for you.
BECU Member Share Savings account required to establish membership and not all applicants will qualify.
10% Introductory Annual Percentage Rate (APR) for twelve (12) months from date of account opening. After that your APR will range from 7.99% to 19.99%, based on your credit worthiness and card selection. Not all applicants will qualify. This APR will vary with the market based on the Prime Rate. Please refer to the Credit and Security Agreement for the terms and conditions, fees, and charges, and other information regarding your credit card account. Credit Card programs, services, rates, terms, and conditions are subject to change without notice. Contact BECU for the most current information. Introductory offers not available for BECU secured or student credit cards. Introductory offer for balance transfers is from the date of transfer, when transfers are completed within 90 days of account opening.
SPECIAL NOTICE: If you pay your credit card balance in full each month, you do not pay interest on your purchases. This is called a grace period. Please note that once your 12-month 0% introductory purchase APR ends, you will pay interest on any purchases (including recurring automatic payments) unless you pay your entire balance (including both transferred balances and purchase balances) in full.
It may take up to 7-10 business days to post balance transfers; therefore, you may need to make payments to your other account(s) to keep them current. Balance transfers cannot be used towards amounts you owe BECU. BECU may decline one or more requests in whole or in part. Balance transfers are contingent upon the available credit on your credit card account. In the event that your requests exceed the amount we approve to process, we will fulfill your requests in the order provided in your response. We are not obligated to fulfill a request if any part of the request would exceed your credit limit. BECU does not charge Balance Transfer fees. We will apply minimum payments at our discretion, and we will apply amounts that exceed the minimum payment amount due to balances with the highest APRs first.
2Loans are subject to credit and collateral approval, and not every applicant will qualify. Certain restrictions apply. BECU must be able to perfect a mortgage lien on your one-to-four family residence. Borrower is required to pay for insurance to protect the property against hazards (including flood insurance, if applicable,) and optional services (e.g. if borrower retains an attorney that borrower is not required to use). In South Carolina, where the law requires use of an attorney, BECU will be solely responsible for paying all attorneys' fees and costs necessary to open the HELOC, and will perform this responsibility fully by paying all reasonable attorneys' fees and costs related specifically to the closing based on rates typically charged by attorneys in the local market for the closing of similar HELOC transactions. Additional state or local mortgage fees or taxes may apply. Loan programs, terms and conditions subject to change without notice. The APR for a Fixed Rate Advance (FRA) as of 4/1/2020 is as low as 4.59% APR. FRAs provide for up to 15 years of fixed monthly principal and interest payments, depending on the amount advanced. FRAs are subaccounts of a HELOC. Contact a BECU representative for current information.