Debt consolidation is the process in which borrowers can consolidate balances into one easy and convenient payment.
This can greatly simplify your debt management plan and provide less hassle.
While there may not be a best way to consolidate credit card debt, researching and understanding your options for your situation will provide you with information to make the right choice.
Credit card consolidation
Credit card consolidation can give credit card holders the option to transfer balances and lower credit rates. These actions do not come free of charge. Often, there is a one-time transfer fee (usually 2-4% of the amount transferred) and an introductory rate that will eventually jump to a higher rate.
Additionally, using one single credit card to transfer and consolidate all balances could consume most of your available credit. This may hurt your credit scores until the balance is paid down. You will want to weigh the impact of that against the money you’ll save to decide whether it is worth it. (You can also find out how your debt is affecting your credit scores for free by using Credit.com’s Credit Report Card.)
Credit card consolidation is best for someone who qualifies for low transfer fees low-rate balance transfer and can pay off the entire debt before the introductory rate expires.
Credit card consolidation also generally works best when there is no other balance or charges on the card while the transfer is being paid off. Keep in mind that several interest rates can make it challenging to manage and keep track of payments and how much will be needed to retire the transferred balance.