Bankruptcy & Foreclosures

In a recent posting, MoneyInstructor.com presents 5 reasons it may be time to consider consolidating your credit card debt into a single loan.

1) Because interest rates are high

The principal reason why most people consider switching credit cards and consolidating all of their outstanding credit card debt into one card is because the interest rates on their existing credit card are just too high.

2) Because of annual fees

Credit card issuers now know they’re in a fight to get new customers and so some of them are offering use of their credit card without requiring you to pay any annual membership fee and not asking members to pay an annual membership fee is a second worthy reason why you may want to consolidate your credit card debt.

3) Personal Loans Sometimes Offer Better Rates

As a way to source debt at a lower cost many of us turn to the option of consolidating all of our outstanding credit card debt as a personal loan (from a bank or credit union) which can then be paid back monthly.

4) Because Consolidating can save Your Credit Rating

Making a single larger payment you can afford is a much more financially sound solution to a bunch of smaller payments that you cannot pay on time.

5) Because some companies will pay you to do it

The last reason to consider consolidating your credit card debt into one loan is because the credit card issuer may pay you to do it! Believe it or not, the credit card industry has now become so competitive that issuers are fighting among themselves to get people to sign up to their card. Here, when the card issuer knows you have an existing credit card, they’ll sometimes offer you the option of transferring the balance of your outstanding existing credit card debt to them, in return for which they’ll reduce some of the debt from your outstanding balance. As always, be careful though, those warning signs regarding interest rates and fees still apply.