The DIY Credit Card Debt Consolidation Guide
The consolidation technique can be a great way to bring all your card debt together in one place where you can manage it better with a single, lower monthly payment. Here's what you need to know...
Thinking of credit card consolidation? Are you one of the many millions quietly concerned about the mounting credit card debt you currently owe?
Are the interest charges and fees driving your debt higher and higher? Well dont panic just yet! The option to consolidate credit card debt can be a very effective, practical way to help you begin to get rid of that debt for good!
Infographic DIY Credit Card Repayment Options
Here is a useful info graphic on how to consolidate your cards. Simply point your cursor on the image to see a larger version. You can also print it out by pointing your cursor over this link and choosing: save as.
My recommendation is to study how Mia (the character in the info graphic) approaches her debt by analyzing each of her steps carefully.
The most important thing here is not to give you a method on how to consolidate your cards.
Instead, I want you to connect your own mind and reflect over how you can use here methods at your own debt.
I recommend you to print out this guide in the full resolution and then grab yourself a cup of coffee and carefully study it until you understand it completely.
What Should You Look For in a Consolidation Card?
Most offers for credit card consolidation boast initial low APR periods generally around 12 months. Take a look at the APRs of the cards you currently hold and compare them against the APR of the consolidation card you are considering.
Youre sure to see a huge difference in the figure youll be paying. These vary greatly, so shop around and find the best offer for you.
A secondary reason for why you should consolidate your cards is the convenience of having your entire debt in one single account.
This makes bill payment so much more simple and hassle-free as you only need to think about one payment, rather than several across different cards.
Finally, if youre struggling with your current card payments you could be damaging your credit report. By closing them and consolidating into one account, you are more likely to be able to make the lower monthly payments on time, which will begin to rebuild or strengthen your credit report for any future credit applications.
How do I Close My Credit Card?
Many of us these days tend to have more than one credit card. Initially it may have seemed like a good idea, perhaps to pay for that vacation youd been hoping for, or perhaps to help with the costs of moving or even a new car.
But it never quite worked out the way you planned, did it? Do you remember thinking "Ill pay it off quickly or maybe Ill close my old account when I open this one"?
Its a very common situation to be in. You open a second or third credit card and before you know what happened, you found yourself with a bunch of maxed out credit cards and huge monthly payments.
If you've decided now to consolidate those accounts to improve your finacial situation or to save on interest charges, you need to ensure you close the old ones properly.
Close Credit Card
Do not think that because your balance is clear and your card is cut up, that your account is closed. This is where many people go wrong, soon to end up back in debt up to their eyeballs! Most card issuers will send a replacement card right back.
To remove temptation you must call and ask them to actually close the account fully.
But beware, this is when they will pile on the offers and try to get you to keep the account open. You must stick to your plan!
If by chance, they make you a better offer than what you were going to get with your new "consolidation" card, you may want to consider. Just remember to close the newer account.
Chances are, your old credit card company will offer you zero percent interest on purchases and possibly even balance transfers, but it would be highly unlikely that they would offer you zero interest on your current balance. So your best option will most likely be to just go through with closing the account.
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- What are the risk associated with using debt consolidation services actually?
Write a Letter Instead of Calling
If you do not want to call your credit card companies to close accounts, you can write a brief letter explaining you no longer the credit card and request the account be closed.
You should get confirmation of this in the mail after they have closed it completely. This may seem like a waste of time, but it will ensure you are not tempted to build up the debt again!
What happens when the interest free period runs out on your consolidation card? If you haven't paid off your balance in full, simply transfer your balance to one of the zero interest credit cards available today and do the whole thing over again!