Consolidating loans affect credit score
Don’t use your IRA to pay debts unless you are 100% confident the money will be replaced within two months, say, with a tax refund.
Otherwise, you’ll be hit with a penalty and taxes on the funds.
(Of course, while you’re using your IRA money, it won’t be earning you any interest either.) From friends and family: These loans can be your best or worst nightmare.
Ideally, you offer your parents or another private lender an interest rate that’s better than what they’re getting at the savings bank.
If you do go for it, keep it as professional as possible.You’ll also want to read the fine print in order to avoid surprises such as a balance transfer fees or application fees.If an offer sounds too good to be true, it probably is.“The company will then use this money to attempt to negotiate with creditors to reduce the amount of principal you pay off.” If you’re considering this option, try to speak with a nonprofit credit counselor first because debt settlement can put your credit in jeopardy.(You can learn more about choosing a credit counselor here.) If you don’t pay your debt, creditors could hire debt collection agencies, which could lead to a lawsuit, the CFPB says.