Credit Card Consolidation – Is It A Good Idea To Consolidate Your Credit Card Debt?

Credit card consolidation can be a good option to help pay off debt.  There are a few pros and cons to the whole process but if you are considering it, it may work for you.  You first need to know what it is and what it can do for you and too your credit.

Consolidating your credit card debt is a tough decision to make.  Many people are having a hard time in this recession and have turned to it for help.  With people defaulting on their mortgages and the unemployment rate, it is only natural that more and more people would start accumulating debt.  It is good to know what your options are first.

You could try paying it off yourself.  It can be difficult, and with the interest rate, a long process.  But there is something to be said for paying it yourself.  This is rarely an easy option to choose recently.  It is too easy to fall into debt with out a choice.  Lets say Jane has a small amount of debt and is just barely able to pay it off.  One day Jane has a pain in her lower abdomen and goes to the doctor to discover she has an appendicitis.  Jane has insurance but it will not entirely pay for the procedure.  She has no choice but to have the surgery.  Now she has a couple thousand more on top of her debt and she can’t afford the payments.  Medical bills pile up so fast and when you have no option to pay what do you do?  She has a couple of options outside of paying it all herself, one would be bankruptcy.

Bankruptcy sounds like a terrible word, but it isn’t.  It is a tool you can use to put you back on a path to good financial health.  Of course the down side is the bankruptcy, like a chapter 7 bankruptcy, stays on your credit for 10 years.  This makes it difficult to get a loan or even get a job.  This doesn’t mean you shouldn’t consider it.  If you are currently unemployed and have a large amount of debt, there isn’t much you could do, and getting a job may prove to be equally difficult to have already had a bankruptcy.

So in between those two is debt consolidation.  The good side is you get someone to deal with the creditors while you pay lower amounts to your entire debt.  The bad side is your credit score will drop.  The company usually doesn’t start paying the creditors for a few month, while pocketing your payments.  Once they start paying it is already too late.  For many it doesn’t matter because the debt is already lowering their credit score.  It may prove useful to go ahead with it so you can stop dealing with the creditors and start getting your sanity back.

It can be a tough option.  If you get out there and look for credit card consolidation help, you may find it.  If you think it is the right choice, then consolidate your debt and start down your own path to financial freedom.