How to Consolidate Credit Card Debt?

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1. Credit report verification

Did you know that errors may appear in credit reports? It is important that you take time to review your credit report to identify and correct any error. Undetected problems could hinder your efforts to qualify for the much-needed debt consolidation. In order to interpret your credit report correctly, use a Free Credit Report Card. You also get credit scores for free thanks to this Card. When analyzing your finances, make sure you request a free annual credit report from each of the three national credit reporting agencies.

2. Consolidate to a low-interest credit card

You can start searching for a credit card with a low interest rate, but this is possible only if you have good credit. As you pay out your debt, lots of money can be saved if you manage to transfer high-interest rate credit card balances to a single card. A number of options for balance-transfer to low-interest rate credit card are available. You just need to see which one is suitable for you.

3. Choose a credit union or local bank to consolidate!

Credit unions or local banks may have the right loan for you to consolidate your debt. Information on consolidation options should be available with your loan office at your financial institution. Before you apply for a debt consolidation loan with them, it is important to look into their requirements, terms and conditions. Find out whether a minimum credit score is needed to qualify for the loan.

4. Consolidate debt with an online lender!

It is important to choose a well-reputed lender when you decide to apply online. The best verification possible is with the Better Business Bureau: there you can find information on complaints from other clients.

Another necessary check-up before choosing an online lender is that of state registration. Is the lender registered to do business in your state? This piece of information is available with the Attorney General’s office or your state’s Department of Banking or Financial Regulation.

Do not trust a lender if they promise you a loan regardless of credit score. Moreover, beware of businesses and websites that charge high upfront fees for debt consolidation packages.

5. Take up a debt management plan

Credit counseling firms could help you with a debt management plan, taking a huge burden off your shoulders. By means of the debt management plan, you make a single monthly payment to the  credit counseling agency that you contract, and, then the agency pays each of your credit card lenders. Sometimes the participation in a debt management plan could convince a lender to reduce the interest rate on your credit card balance.

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