If youre considering credit card consolidation to find debt relief, you need to make sure youre using it correctly, and not getting anything out of the deal. Im not saying that credit consolidation is a bad idea, or that its the only way to deal with debt, but it is not the solution.
Credit Consolidation Cant Be Saved
Let me start off by saying that credit consolidation, at least as it is commonly used, is not a panacea. It is not going to work for every single debt that youre dealing with.
The most important issue is that if you havent already filed bankruptcy, or at the very least have some savings to pay off your debt, then there will be no good reason to use it.
The debt youre trying to get rid of will still exist. You cant save it. Its no good to you to “borrow money” to pay off your debts because that will just increase your monthly payment and keep you from having a problem. When youre working on a mortgage, a car loan, or any other debt where you are being paid interest on that debt, then I recommend that you use the credit consolidation process because it wont’ eat your savings like the mortgage will. But for everything else, I don’t recommend that. Credit Consolidation Is A Dead End Now for the reasons I don’t recommend credit consolidation. As you can see from the chart above, I have no advice for you. But for the people that are desperate to take the steps, here’s my suggestion. Go to FICO.com. I have been buying a product called FICO for a long time and use it to help track your credit. I personally am a fan of this service and find that it is the most comprehensive service you can get. I think that it will prove to you that there are serious holes in your credit report. However, if you get your score over 730, it is likely that you have had some credit in your past and therefore should not use a credit card to pay your bills. It is very important that you pay all of your bills on time. With no debt to the bank, the bank won’t be able to collect money from you if they find out that you didn’t pay. If you don’t have to, use that money on things that are more important. Do not allow yourself to become an uninvited guest on any other person’s card or even use other people’s cards at all unless you must. Remember, you don’t have to use a credit card for a specific purpose. If you can use cash for everything, why would you use a credit card?
If you have a high credit score and you don’t want to use a credit card, you can reduce your interest payments with certain cards. Keep in mind that with each annual fee, you will reduce your