Credit Card Debt Consolidation is a positive step if you have looked at and explored all the other avenues that may be available to you first.
Taking out a loan is a longer term debt than may actually be necessary. The aim after all is to eliminate debt altogether and start afresh. This may not be as hard as you think, but it does take some discipline on your part, and you have to want to do it!
Lets look at the first steps you need to take when making your plan.
Get all your credit card statements together. total them up so you know exactly the figure you are dealing with. Don’t be scared, the only way to move on is to face the debt demons head on.
It is at this point that you should make a decision as to whether you need a Credit Card Debt Consolidation Loan or try to tackle each debt individually.
The way to determine this is based on your earnings vs the amount you are currently paying back to your credit card companies each month.
The cards that need to be tackled first are those accruing the most interest every month. These are the ones that are draining you financially. By paying the minimum payment every month, you are barely making a dent in reducing your debt.
If you can manage to pay the minimum payments on all cards and still have excess income left over, a good idea would be to pay that excess off the card that is accrung the most interest. By doing this, the amount will reduce, allowing you MORE disposable income to pay a greater amount off…and so on…
An even better alternative would be to locate a credit card company that offers 0% on balance transfers. This is usually for a six or twelve month period and this would give you a breathing space to start reducing the debt much faster.
Another good place to visit is a non profit consumer credit counseling service. They will help you work through your debt. They will even contact the credit card companies on your behalf. They can get payments frozen, deferred and in some cases written off.
So before you consider a credit card debt consolidation loan, it pays to look at all your options, you could end up paying a lot less over a shorter period of time. But if you have your mind set on this option, be sure to go with a reputable company or bank. Read the small print. If you are afraid to ask questions, find out on the internet. There are many forums with people waiting to share their experiences with you. Chances are, whatever questions you ask, someone will have the answer.