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Credit card debt consolidation

By: CCN.com

Some people carry debt on their credit cards due to inability to make payment owing to some emergency expenditure, others carry debt due to excessive or irresponsible expenditure on their credit cards (forgetting that they need to pay it back too). Today, a lot of people carry multiple credit cards and carry debt on each of the cards. Whatever be the reason, everyone wants to get out of this debt. Debt consolidation is probably the first and the best step in this direction.

Credit card debt consolidation is a pretty popular concept now. Put simply, debt consolidation is the process of transferring your debt from multiple credit cards to one credit card. It is also called transferring balance from multiple credit card accounts into a single account.

Why would one go for debt consolidation? Well, there can be multiple reasons. You could decide to go for it just to prevent confusion in dealing with multiple credit card accounts. However, the primary reason is lower APR on the credit account you are shifting your debt to. The APRs on different credit cards can be different. A lot of companies even try to lure new customers by offering a lower APR than their current credit companies when they transfer balance from their current card to the new card.

However, this is easier said than done. You need to read the fine print on such balance transfer offers, understand them completely and judge whether they would actually be beneficial to you. Among others, the following 2 set of questions are most important and need to be examined carefully before zeroing-in on a balance transfer offer:

Is there a


fee associated with the balance transfer? If yes, then does it offset the benefit obtained in terms of reduced APR? Is the lower APR applicable only for a limited initial period? If yes, then how long is this period? What is the long term APR and is it less than the current APR on your credit card? Will you be able to pay all your debt during this reduced APR period? Is the card going to be beneficial to you in the long term? You might also want to explore other avenues of debt reduction before actually going for debt consolidation. Contacting a good debt assistance company might be easier and better for you since these companies generally have all the information about balance transfer offers and other debt reduction/elimination methods. However, do not use services of such a company unless you are absolutely sure about the quality of their services. Declaring bankruptcy or a monthly-installment based personal loan are other possible means of eliminating debt. If you are not entirely sure about the best method, do not hesitate to take professional advice even if costs to a small fee. This fee might actually turn out less expensive in the long term as compared to the wrong option chosen by you all by yourself.



About the author:

About the Author

Rudy Hadisentosa: CCN.com is a free online credit cards review and application website. We offer credit cards selection from visa,master cards, discover, american express and many others. We have quite some categories and hundreds of credit cards selection to fit your need. Apply for a credit card at CCN.com.