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Pros And Cons Of Consolidation Credit Card Debt Loans

If you are carrying multiple credit cards, then you might have considered credit card debt consolidation. It is a process by which multiple credit card payments can be done by one single monthly payment. It certainly is a humongous saving in one’s resource in terms of time, effort and interest rates etc., Here is a compilation of all that is relevant about credit card debt loan.

Benefits

  • Credit card consolidation companies offer lower interest rates for an extended term period.
Pros And Cons Of Consolidation Credit Card Debt Loans
  • With a secured consolidation of credit cards, the rates of interest might be lower.
  • With an unsecured credit card debt consolidation, there is no risk of asset forfeiture.
  • The chances of obtaining secured are higher than unsecured.
  • A single payment at lower interest rates will ease the burden substantially than carrying and paying for multiple cards.

    • Drawbacks

    • Even though the repayment terms are longer, a person might stay in debt for a longer period with credit card debt being consolidated, sometimes for a lifetime.
    • Even though the monthly payment is lower, the total payment might be much higher than the principal amount.
    • In case of secured loan consolidation, asset forfeiture risk is higher on non-payment of dues.
    • In the case of an unsecured consolidation, the interest rates will be significantly higher.
    • Bad Credit Score can increase consolidation interest rates for Credit Cards/Loans.

    Best Credit Card Consolidation Companies

    There are many big companies which will help you consolidate your credit cards. The best ten companies are :

    • New Leaf Financial
    • ResuceOne Financial
    • Clear Advantage One
    • Accredited Debt Relief
    • Brite Solutions, Inc.
    • DebtHelp,Inc
    • National Debt Relief
    • Pacific Debt, Inc.
    • Timberline Financial
    • Freedom Debt Relief

    Warnings/Precautions

    • Though, single monthly payments give relief from the several payments it is important to have discipline in money behavior.
    • Indiscipline might lead back to where it started all over again.
    • Credit Card/Loan consolidation must not be mistaken/interchanged with Credit Card Debt Settlement or Credit Card Debt Elimination.
    • It is important to distinguish between the real and fraudulent debt consolidation companies.
    • Credit Card is topping the list in the complaints from the consumer to the Federal Trade Commission(FTC).
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