5 Ways to Consolidate Credit Card Debt

Here are five ways that you can consolidate your credit cards into one low-interest loan.

1. Personal Loan or Line of Credit - If you have adequate income and good credit history then it makes sense to apply for a personal loan or line of credit which has an interest rate significantly lower than what most banks would give you on a home equity loan. 

It is also a great idea when you apply for this type of loan warning your credit history is in good standing when you look to consolidate your credit card debt with a personal loan.

2. Home Equity Line of Credit - This type of loan and line of credit will vary depending on the equity in your home, but it usually comes with an interest rate that is just slightly above what banks would give their best customers for unsecured loans. 

If you have decent equity then it makes sense to borrow against your house rather than borrowing money from a bank or other lender that requires stringent conditions over the life of the loan. 

A home equity line of credit can be used for almost any purpose including consolidating credit cards, paying off high interest debts and consolidating other types of loans and you can easily make monthly payments against your line of credit.

3. Personal Loans via the Internet - There are many websites that will consolidate your credit card debt for a much lower interest rate than what most banks would give you on a home equity loan or personal loan. 

For example, if you have $10,000 dollars in unsecured credit cards then your interest rate could be as much as 18% which comes to around $1,800 per year. If you take out a personal loan online at 12% over 36 months it would cost you $924 per year and save you more than $900 in finance charges alone! The best thing about these low- loans is that they usually don't require a monthly payment and provide you with the flexibility to pay off your debt anytime. 

You can make one consolidated monthly payment via check or debit card. Most of these companies also offer free debt consolidation services and advice on how to get out of debt and stay out of debt.

4. Debt Consolidation Loans - If you have a bad credit history or no credit history then it might be difficult to get a personal loan from a bank, but there are several lenders that specialize in consolidating high-risk borrowers such as people with bad credit, no credit, and even past bankruptcies. 

It makes sense if you consolidate your unsecured debts into one low-interest loan especially after you consolidate all other types of debts such as car loans, mortgages, business loans, home equity loans, and student loans.

5. Debt Settlement Services - If you have a large amount of credit card debt then it might be difficult to consolidate your debts into one low-interest loan, but there are some companies that specialize in consolidating other types of unsecured debt such as high-interest credit cards with the creditors themselves. 

You might want to consider speaking with a non-profit or government agency like Consumer Credit Counseling Service for help if this option is right for you. They will likely charge an affordable monthly fee for consolidation service which can easily be taken care of through automatic withdrawal from your bank account each month.  Plus they may even be able to renegotiate certain terms on your existing credit card debts via debt settlement negotiations with the creditors themselves.

Conclusion

When you consolidate your credit card debt with a low-interest personal loan, home equity loan, or line of credit then you have the opportunity to take advantage of lower interest rates and lower monthly payments. This will not only save you money over time but also give you peace of mind knowing that all of your debts are consolidated into one manageable payment each month. 

However, it makes sense to apply for a personal loan or line of credit which has an interest rate significantly lower than what most banks would give you on a home equity loan.  It is also a great idea when you apply for this type of loan warning your credit history is in good standing when you look to consolidate your credit card debt with a personal loan. Debt consolidation loans are becoming more popular each day as it can save you thousands of dollars in finance charges over time.