Are you are struggling in making payments to your credit card debts? Then, credit card debt consolidation may be the answer to your problem.
There are several ways by which you can consolidate debt. It is important for you to understand each option so that you will be able to choose the best alternative, the one that will work to your advantage.
Some of these strategies are more affordable than other options. However, your consolidation options are also limited by your credit score.
Experts suggest the following as options in credit card debt consolidation.
Zero Interest Card
First, you can consolidate your credit card debts by transferring these debts to a single low interest account. There are entities that can give you zero interest for about six to eighteen months. There are also those that charge lower interest, depending on your credit score.
During this period of time, all your payments will primarily go to the payment of your principal obligation. After such time, the company may charge you interest, from 13 to 27 percent annually.
There are also companies which charge transfer fee based on the total amount of credit card debts transferred to the singular account. Still other entities charge annual fees.
Not everyone though can avail of this option to consolidate debt. Only those with good credit standing can avail this.
It is then important that you check your credit reports and score before exploring this option. Experts suggest you can get your free annual credit report from credit reporting agencies like TransUnion, Equifax and Experian.
Once you have your credit reports, check for errors. If errors exist, dispute them. Bear in mind that an error on your credit report may prevent you from getting all the debt consolidation help you can get.
Second, you can avail of personal loans to liquidate your credit card debts. These loans may be available from your bank or credit union.
These personal loans often charge simple interest, as compared to some credit card debts which charge variable interest rates. Sometimes, they also charge different rates for balance transfers.
Just like the first option, a good credit rating is needed when taking out personal loans. The interest rate that these financial institutions may charge you for personal loans will depend on your credit rating.
As such, without a good credit score, they may charge you higher interest rates. This will lead you to more harm than good.
Well, you can also go to your credit lawyers when you plan to consolidate debts. Your credit lawyer may be a good resource person who can help you help you deal with your debts.
Also, your credit lawyer can negotiate with your credit card companies and other creditors.
Your credit lawyer can fight for you when you face lawsuits related to money issues. They can even fight against collectors who may harass you and resort to unlawful means to get collections.
Credit lawyers can also help you improve your credit score by assisting you to remove inaccuracies in your credit reports. For this type of service, many credit lawyers do not charge an upfront fee.
They will just get their fee from the money that they will able to collect from entities that screw up your credit. In many cases, you are assured to get a certain amount from what they collect, and then they get the balance.
Credit lawyers can also help you enforce your rights when errors have been found to have been made.
Indeed, consolidating credit card debt is a challenge. But once you have truly understood each option that is available to you, you will then know each option’s financial impact.
If you’re looking for a way out of credit card debt, call us. We’d be happy to speak to you about your situation and see what the best thing for you is.