Consolidate Credit Cards

Written by Kevin Tavolaro
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Because of the interest rates and fees associated with many credit cards, if your account becomes delinquent, you might find yourself rapidly sinking into ever-increasing debt. Whether you fail to keep up with an account balance due to irresponsible spending, or as the result of unforeseen emergency expenses, you're likely to find it a hard predicament to escape. As an account falls behind, late fees, coupled with interest, can soon leave you treading water, paying just enough each month to cover the expanding penalties without having any effect on your growing mountain of debt.

Many people exacerbate this situation by applying for additional cards, in the hopes of using one card to pay off the fees on another. Considering that the new card is also likely to have a higher APR than the original, this approach often does nothing more than consume more money without allowing any progress. Fortunately, there are organizations available to assist people in such predicaments, by helping them organize their finances to a point where they can begin reducing their debt with regular payments. They're known as debt consolidation specialists, and they've helped many people take the first steps towards restoring their credit.

How to Consolidate Credit Cards

Debt consolidation companies can merge your various debts into one lump sum, which is then paid off in monthly installments, in increments decided upon by the cardholder and the service. By consolidating your credit cards, these services allow you to pay the same interest rate for all your outstanding debts, making the balance somewhat easier to manage. Balance transfers used to shift outstanding debts between two credit cards can ultimately do little more than systematically increase the money owed. By consolidating your balances into a single sum, regulated by a single APR, you can begin to get your debt under control.

Before you consult a credit card consolidation service, you might want to try a more direct approach. Some credit card providers might be willing to work with you towards consolidating your debt in order to clear the balance. They may offer suggestions, such as a card that might actually be beneficial if used for a balance transfer. If you are considering this approach, however, you should be certain to apply for the card with the greatest discrepancy between the APR and the credit limit. This will allow you to transfer debts to the card without racking up overwhelming interest charges.

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