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Credit Card Debt Consolidation > Why Would You Even Consider Credit Card Debt Consolidation to Begin With?
Why Would You Even Consider Credit Card Debt Consolidation to Begin With? |
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When you are considering Credit Card Debt
Consolidation, it is essential to know that having a large number of credit
cards is a deterrent to the credit card issuers to sanction any further loans. The fact of the matter is that the more credit cards you have, and the more credit that the card issuers extend, and the more of that credit you've used, the less likely it is that, when the time comes that you want to buy that new wall-sized Plasma TV, you'll be able to. Why, well, because those credit card issuers like to cover their bases, and denying you that increase in credit is one way to do it: Something they don't want and in need of credit card debt consolidation. On first thought it might appear that having more credit cards is better than having fewer cards, but the more credit cards you have, and the more credit that the card issuers extend, and the more of that credit you've used, the chances of you getting any further loans for buying something that you fancy will be lesser. This is because the credit card issuers like to safeguard themselves and refusing any further loans to you is one way of doing so. It is apparent that if you have any further credit card loans, your total loans will climb sky high and sooner or later you will find it difficult to make all your payments and as such you will default in your payments - a situation that they do not fancy very much. At this stage you will find yourself in dire need of credit card debt consolidation, having realized that due to the magnitude of your total loan, even if you were able to make payments in time and stopped using the credit cards completely, it will take years to pay off all your debts. Credit card debt consolidation helps consolidate on to one card with a lower interest rate. Is Credit Card Debt Consolidation Really So Difficult? It is not all that difficult if you develop a credit card debt consolidation plan, which might work like this. 1) Except for your lowest interest credit card, make minimum payments on all other cards so that you free up some credit on your lowest interest credit cards. 2) Transfer some balance from your high interest credit cards to your lowest rate cards. 3) Continue doing the above steps till the entire balance of your highest interest rate cards is clear. 4) Close the account of the highest interest rate card, unless it is your last card, in which case the credit card debt consolidation process would have been complete. 5) Or go back to step 1. This is the way to end up with a single low interest rate card. You will notice that during the above process, you will be flooded with many offers of new low introductory rate cards, which you should ignore, UNLESS the post-introductory rate (meaning the REAL APR) is lower than that of your current lowest rate card. In such a case you should transfer whatever balance you can from your highest rate card to this new one and then close the account on your highest rate card. Besides Credit Card Debt Consolidation, What Else Can You Do? Once you have recouped with credit card debt consolidation, you have to learn from your earlier mistakes and get rid of all your extravagant spending habits, which led you to so many credit cards and the consequent financial mess. You must learn to shred all new credit card offers without even opening them and turn a deaf ear to all the commercials enticing you to these veritable wells of misery. |
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