Charlotte, NC (PRWEB) October 27, 2007
Debt often has a negative connotation in today's society, but did you know there was such a thing as good debt? There are times when debt makes sense. Effectively managing your credit doesn't mean eliminating debt completely; it simply means you must manage your good debt and avoid any bad debt.
Good debt helps you achieve a goal, or leaves you with a sound financial asset. Things like mortgages, which allow homeowners to build equity; home equity loans, which allow homeowners access to capital for things like home improvements that will increase the home's value; and student loans, which foster professional advancement and, usually, higher salaries, are all examples of good debt.
Bad debt is debt that you don't fully understand or unnecessary debt that you use to pay for living beyond your means. Examples of bad debt consumers should avoid include carrying too much credit card debt. The longer it takes you to pay off a credit card loan, the more interest you'll pay. Credit card debt becomes a vicious cycle of minimum monthly payments and spiraling interest payments so consumers should avoid it as best they can. Zero money down loans are also a form of bad debt. While the phrasing sounds tempting, interest rates skyrocket on these loans if you're unable to pay them back in the short amount of time allotted.
As you learn the skills of smart borrowing, you may be surprised at how much more confident you will become at managing your debt and choosing the best sources of credit for you, and how passionate you may become in passing on this newfound knowledge to friends and family. Empowerment tends to energize people.
For more tips on managing your debt, please visit the LendingTree Smart Borrower Center.
About LendingTree, LLC:
LendingTree, LLC is the nation's number one online lending exchange, providing a marketplace that connects consumers with multiple lenders that compete for their business. Since inception, LendingTree has facilitated more than 20 million loan requests and $152 billion in closed loan transactions. LendingTree provides access to mortgages and refinance loans, home equity loans/lines of credit, auto loans, personal loans, credit cards and high-yield savings accounts via Lendingtree.com and 800-555-TREE.
Launched in 1998 with headquarters in Charlotte, North Carolina, LendingTree, LLC also owns and operates LendingTree Loans sm, LendingTree Settlement Services, LLC, GetSmart®, and HomeLoanCenter.com. LendingTree, LLC is an operating company of IAC.