Credit card debt is an issue that many people in the world have. Statistics say that U.S. residents owe more than $793 billion alone. Most households have at least one credit card in them, and some have as many as three cards in the home. Sometimes a debt consolidation is in order for a person who has a credit card. It can help some consumers to get back on track and get their debt paid down. The following is some information on credit card debt consolidation and why a consumer should try to use personal loans to do the consolidation.
About Debt Consolidation
Debt consolidation is a process by which an indebted consumer merges or puts together numerous accounts with each other. The result of the process is one easy-to-remember monthly payment for the debtor. Consumers usually seek debt consolidation when they have more than two credit cards, and all those credit cards have different interest rates. No consumer has to conduct a debt consolidation, but it is a good idea for a person with many cards to consider it.
Benefits of Debt Consolidation
A consumer can get three or more benefits from conducting a debt consolidation. The first benefit is peace of mind. The consumer no longer has to try to keep up with multiple payments because there is only one payment to the consolidation provider. The process cuts down on missed payments and late fees. Another benefit of conducting a debt consolidation is that it can raise the credit score. Thirdly, the consumer’s credit score will most likely rise each time he or she makes a payment on the consolidation.
Methods of Debt Consolidation
Many methods of debt consolidation exist for the consumer. The first kind of debt consolidation that exists for the consumer is a debt consolidation loan or personal loan. The consumer borrows the funds from a personal lender. The funds cover the total amount of debt that the person has. The consumer then gets to pay one monthly payment instead of several monthly payments.
The second kind of consolidation that exists is called a credit card consolidation or personal consolidation. That consolidation is one that the consumer can do by himself or herself by applying for a high-limit balance transfer card and then transferring the balances of existing credit cards onto that card. The downside to such a consolidation is that the credit card account revolves. That may sound like a positive attribute, but it isn’t for a person who is trying to lower debt. To the contrary, using high-limit credit card to consolidate debt may cause the person to spend more money.
A third way that someone can consolidate debt is with a debt management company. This quirky consolidation method does not involve any loans. The positive side is that the consumer does not have to open up any new credit cards. The negative side is that the consumer has to trust a third-party to ration his or her monthly payment funds and distribute them to the various creditors. Additionally, the debt management company charges a fee for its monthly services.
Why Personal Loans Beat the Rest
A personal loan is the best option when it comes to debt consolidation with credit cards. The reason that it is a better option than other options are is that it offers a low interest rate and no opportunity to revolve. With no opportunity to revolve. The personal loan provider just pays the other debts, and the consumer pays the lender each month. The process is very neat and practical.
Apply for a Personal Loan Today
An interested consumer can apply for a personal loan today. Requesting a cash advance from a reliable and longstanding provider is extremely important. The consumer should want to obtain the best interest rate for the consolidation. The idea is to pay the debt down as quickly as possible and with the least amount of hassle. The consumer in this case can reclaim his or her “good debtor status”quickly. The process can start as early as today. Lenders are waiting to help someone to overcome debt in a big way.
