Charge Card Debt Consolidation

What Is Charge Card Debt Consolidation, And Will It Help You To Be Debt Free?

What Is Charge Card Debt Consolidation?

Charge card debt consolidation is one of the more risky choices when it comes to debt consolidation. Charge card debt consolidation involves getting a charge card with a limit that would cover all of your current debts. Once you get this credit card, you can then pay off your other debts and have only one payment that is hopefully lower than what you were paying on all those other debts. The major advantage of this option is that you don't have to get a loan or endure the embarrassment of working with a credit counseling service. You pay off your debts all at once, but still have a payment to your new credit card.

Disadvantages of Charge Card Debt Consolidation

While this may seem like a very good option, there are a lot of disadvantages associated with it. For instance, the introductory interest rate on the new card might be low to begin with, but it will eventually go up. You are also not really getting rid of any debt; you are just transferring it instead of confronting the problem head on. In addition, getting another charge card is probably not the best choice if you are already in charge card hell. You may start with the good intentions of paying if off, but once you start getting room, you will probably find excuses to charge more stuff.

Are There Other Debt Consolidation Options?

There are other options that often make more sense, including taking out a home equity loan or second mortgage, or working with a credit counseling service to pay off your debt at lower monthly payments. The easy solution of charge card debt consolidation may look good to you, but you need to think it through before you decide to do it. It can leave you deeper in debt than you were before unless you can restrain yourself from succumbing to the lure of easy money that credit cards offer