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5 Tips for Consolidating Credit Card Debt

Do you have credit card debt? Do you wish you had never applied for a credit card? Are you worried about your debt and your financial future? If you answered “yes” to any of these questions, you need to read this issue because we’ll be discussing how to consolidate debt. When you feel like all hope is truly lost because you will never be able to pay anything back, there is hope. There are options for you and throughout this article we will discuss these options, and we will provide you with many tips for consolidating your multiple debts. One of the options you will have is the credit card debt consolidation loan.

credit card debt consolidation loan

What does credit card debt consolidation loan look like personal loan and what does it do for me and can it get me out of debt? A credit card consolidation loan is a loan that you borrow to pay off your credit card debt. Credit card consolidation loans are meant to be helpful and they help you pay off some of your debt. When you get a credit card consolidation loan, you take that money and put it into one lump sum, so you can pay off your credit card balances in one payment. The terms of the credit card consolidation loan are very flexible, they are tailored to help those with large credit card debt to make it easier and give them the opportunity to solve their debt problems. Credit card debt relief loans give you the freedom to have a lower fixed rate instead of paying the super high interest that many cards have. There are many people who don’t know that they can get a credit card consolidation loan and pay off their existing cards with it. The problem with credit card consolidation loans is that your credit must be around 660 to qualify. Some people have already messed up their credit report where they cannot qualify for the credit card consolidation loan, if you are one of those people there are four other options for you.

Non-profit credit counseling

If you’ve tried to get a credit card consolidation loan and been turned down, it’s not the end of the world. There are many non-profit credit counseling organizations that can help or point you in the right direction. These organizations can also help you repay your debt. Typically, they can help you work out a plan for you to pay off your debt. The company determines your payments, you agree, and then each month you pay the consulting company, which in turn pays each of your credit cards. The advisory company also has the ability to help you lower your interest rate and monthly payments. It is not a free service, therefore, you will be required to pay a small fee for it to work. These companies sometimes require you to close your credit card accounts before helping you. It can and does hurt your credit.

Get a new credit card with no initial balance transfer fee

The credit card consolidation loan didn’t work out or, and you don’t want to use a credit counseling option, you can request a balance transfer fee waiver. This option will help you transfer your unsecured debt in one payment. Then you pay this balance monthly. This may be an easier way for you to pay off your debt. Some cards start you off with 0 interest. There are some who charge 3% to 10% on the transferred amounts. The amount you owe cannot exceed the original credit limit on this card. If your debts aren’t helped with a card after reading about them, you have more options.

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retirement account

retirement account

Some retirement accounts allow you to withdraw money from your account to help pay off debt. One great thing about it, there is no credit check for you to get approved. If you are approved, there may be a way to avoid paying the early withdrawal penalty if everything works out. If you’re considering this, put it into perspective, the younger you are the less you can withdraw, however, there can be a lot of penalties to pay back. If you are under age 59.5, you must repay the money saved in five years, unless you are buying a house. Most people warn others to stay away from this option. If you use your retirement money for credit card debt, your retirement is canceled and you start fresh from day one. Once again. Think how hard it was to get that retreat to begin with, you don’t want to start all over again, do you? If these options are not acceptable, look at the last one.

Borrow money from friends or family

Borrow money from friends or family

When all else fails, we can always count on our family, right? There are positives and negatives with this option. When you borrow money from friends and family, there is a different feeling about them. You must be careful with these situations. With your family or friends, they won’t give you a credit check, however, if you don’t pay it on their terms, the relationship will be at risk. We also don’t like jeopardizing our family’s finances, because we see the direct effects. It’s an option we would choose if we had tried everything else.

No matter what you decide to consolidate your credit card debt with, you need to make sure you’re okay with that decision. When choosing what to do about your debt, try to avoid opening a new line of credit and hurting your credit score, because once you’ve done that and messed it up, there aren’t many options to get a redesign. Be smarter this time and think about it with your partner and family. You want to make sure that you are comfortable with the decision you are making regarding your financial future and that of your family.

Published 08 February 2019; UPDATED May 22, 2019.

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