Credit Card Debt Consolidation

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What - Definition
Credit Card Debt Consolidation - Any action that consolidates credit card debts or repayments on credit card debts.

Unsecured credit card debt consolidation may be achieved in a number of ways, with or without the outside help of a credit card debt consolidation service. Compared to debt that is secured against collateral, there are more options for handling unsecured credit card debt. Consolidation options are outlined below. You can read up about each credit card debt consolidation service in more detail elsewhere on this site:

1. Credit Card Debt Consolidation Loans
There follows a list of credit card debt consolidation loans alternatives.

credit card debt consolidation service

For the purpose of dealing with credit card debt, loans may come in various forms and from sources that are not directly part of the debt industry. When considering the option of credit card debt loans one should evaluate all these loan alternatives - in addition to the other non-loan alternatives.

a) Debt Consolidation Loans

Credit Card Debt Consolidation Loans

This is a specific type of lending product that may be available from industry lenders as well as banks and other financial institutions. The loan could be secured or not. Often the lender pays off your creditors as part of the process. Other types of credit card debt consolidation loans, that is, more funding that may be used to pay off such creditors include:

 

b) Home Equity Loan for credit card debts
c) HELOC
d) Mortgage Refinance to get cash out of the process for credit card debts
e) Refinancing an Auto Loan to get cash out
f) Personal or Signature Loan for credit card debt consolidation
g) Credit card debt consolidation loan from your 401K, 403(b) or other such plan.
h) Credit card debt consolidation loan from family or friend
i) Margin or Collateral Loan secured against, stock, bonds, valuable equipment, artwork or any form of collateral that is acceptable to the lender.
j) Loan against your Life Insurance

When applied correctly, loans are true forms of debt consolidation. Credit card debt consolidation involves reducing the number of creditors, now consolidated into one. The debt is consolidated into one amount or balance owed, instead of two or more each with a separate legal responsibility. This is strict debt consolidation. Credit card debt consolidation should produce a gain that outweighs the cost or fees involved. The idea of credit card debt consolidation is to secure more favorable repayment terms and reduce your monthly outgoings in comparison to the previous multi-creditor situation.

2. Credit Card Debt Consolidation Through Balance Transfer

Card Consolidation Credit Debt  Shift two or more balances onto a new card with an introductory rate. Sometimes thought of as debt consolidation credit cards, this is in effect taking a new loan. Debt is consolidated where you do not use or close the original accounts. In addition to debt consolidation credit cards, credit card debt consolidation could also be achieved by transferring one or more balance to an existing card that has the lowest interest rate and stop using or close the others. There would need to be enough of a credit limit on the card to receive the balance/s. Ideally the new balance should not exceed 33% of the credit limit. Either way fees can be involved. A new introductory rate card has a set time limit before rate hike.

3. Credit Card Debt Consolidation Program / Plan

Debt Consolidation Credit Cards  A Credit card debt consolidation program provider manages a repayment plan for you. Strictly speaking there is no credit card debt consolidation, rather a credit card payment consolidation for you. The debt is not brought together or consolidated into one balance; each individual account and legal responsibility to each creditor remains. Your repayments are consolidated into one, which you now make to the service provider who deals with your creditors. Typically a credit card debt consolidation program lasts for 2-5 years depending on the combined balance total enrolled.

4. Credit Card Debt Consolidation Through Settlement

Again, this is a repayment consolidation approach leading up to the full settlement of individual accounts (hopefully). Consolidation through Settlement is a process that can last for months or longer. The average is 2 years.

5. Credit Card Debt Consolidation Alternatives

Neither loans, program or settlement, where debt remains until paid off - these are some alternatives including free credit card debt consolidation methods by which you can access monies to pay off debt immediately:

- Cash in your IRA
- Cash in investments or policies.
Free credit card debt consolidation:
- Close saving accounts
- Charitable help from family; money that is gifted and not expected to be repaid.
- Earn more to be put towards debt.
- Spend less in order to increase repayments
- Sell valuable things or any items to accumulate a lump sum of cash for the purpose of paying off your card debts.

Many of these options do not require the involvement of a credit card debt consolidation company, that is a service provider who operates in the debt industry. Furthermore, if you decide on debt industry help then you do not need to locate a specialist credit card debt consolidation company. Card debt is a form of debt - not a type of service. Thus, look for providers of each service type (Loan, Plan/Program, Settlement). Credit card debts should be managed wisely. Credit card debts can often spiral out of control if action is not taken. Success requires knowing about and comparing interest rates and perhaps use of a credit card debt consolidation calculator. Credit cards debt consolidation requires strong self discipline to take additional steps necessary through personal budgeting. Credit cards debt consolidation demands stopping use of all cards and closing or having accounts closed. Solid research into third party provider services is needed. A first visit to a counselor for non profit credit card debt consolidation advice is recommended. Many towns have free counseling agencies that are non profit. Credit card debt consolidation is one topic they will discuss as part of their service recommendation.











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