When shopping for credit card debt consolidation advice there are many factors to consider:
Interest rate: First of all, a loan rate will effect you. If you are paying almost entirely into the credit card debt consolidation loan – not the other way round – then you might be best off holding onto your current card debt consolidation loan.
Total amount paid off: This is the second factor to take into account. Keeping a part of your current card debt consolidation loan, which defaults to that rate and therefore reduces your actual payments.
Other costs: In addition to paying off your card debt as it is owing (as they say in the UK – go to the bank or the creditors themselves if you qualify for credit card debt consolidation insurance) over extended periods of time (usually 15-30 years), it is easier to pay back over short periods, such as a few months, and do it relatively regularly, rather than having to pay the entire balance in full every month.
Why pay interest: The more an individual card holder pays back over the course of a year (rather than month to month) the better. In this period, the debt is being paid back (as is your credit line, after all) so the cost of interest is being reduced (to a much lesser extent).
Secured debt: This is a loan (rather than a credit card debt consolidation) to pay off the debt, while the debt will be taken out to reduce the cost (to you). Some cards will offer this as a free service, like balance transfers.
The debt consolidation is often over the best course of time (and later) so it pays back better.
With credit card debt consolidation insurance you only have to pay the interest on the amount you owe – even if you don’t intend to repay. In addition, it only charges a part of the amount of debt so you only have to pay the remaining (almost) total amount.
If you choose your ‘card”s ‘interest rate’ carefully because you don’t want any surprises and because you’ve thought about ‘revolving’ your car or house to pay off the debt, here’s a guide on how to do that and save yourself money.
If the interest rate is too high (you must try not to repay it too soon), you can still go the low end and save yourself some face this way:
Finance charges: This includes all of the costs of buying any product you’ve asked for (to quote me, office equipment and postage) – including: collection calls, court fees, collection letters, court costs etc.
Credit card overdraft costs: Here’s how that goes:
All your credit card debt will be applied to your account – this only for 15 days. During that time, the creditor will not have access to your account as your account holder, and without your knowledge or consent.
The interest: In order to be eligible for credit card debt consolidation insurance you must repay around 16% of your total outstanding balance. This is to cover all debts incurred over the course of a year, that is.
The credit card debt consolidation insurance is relatively cheap and reasonable. Generally speaking, it is only a few pounds less expensive than a separate credit card debt consolidation insurance. The insurance is free of charge and generally helps you stop the headaches and stress of your credit cards becoming uncontrollable and overwhelming in your body.
My advice: save your money for your debt anyway you can afford – only finance your debt so bring some sanity back into your life. In addition, save money by taking out a loan rather than relying on a loan. It will help you come up with new funding and reduce your debt over time. The aim is to rid yourself of the debt by taking out a loan instead of borrowing from the bank. So help yourself by making wise choices.
Credit Card Debt Consolidation Options
If you’re in a financially tight spot, personal credit card debt consolidation could be a helpful way to keep the situation in perspective. It may help to fill out an application form, so that you could consolidate your high interest credit card debt onto another account. You may also want to consider applying for new credit cards, because individuals with good credit ratings will be eligible to be included in the consolidation. If you want to consolidate multiple credit card accounts, carefully read all terms and conditions of the agreements before you begin. There may be hidden charges or fees that could make the cost of consolidating all of your credit card debt unnecessary.
The benefits of a debt consolidation offer almost always outweigh the potential drawbacks. With a simple glance, it becomes clear that there’s a wide variety of credit card consolidation solutions to choose from.