Consolidate Your Credit Cards

Are you buried in a pile of credit cards? Do you struggle each month to meet the minimum monthly payments on your cards, or just above the minimum to feel good about not paying just the minimum? Do you use your cards to pay day-to-day bills because you don't have the cash? You're not alone, not by a long shot.

Consolidating credit cards may be the answer to your dilemma. Depending on a number of variables, this may be an easy task or it may be a lot harder.

If you want to consolidate credit cards you have to answer a few questions for yourself and then take action. By the way, the hardest part will probably be taking action. Sometimes when you're in overwhelm, i.e. trying each day to figure out how you're going to pay your bills and going deeper into debt, it's hard to take action on anything except trying to survive each day.

Do you own a home? Do you have some equity in it? If you answered yes to these two questions, your task of consolidating your credit cards is going to be easier.

By the way, if you didn't understand the question about equity, it's the difference between how much your house is worth minus how you owe on your home - your mortgage. You may have more than one mortgage, a first mortgage which almost everyone has, and maybe a second mortgage or home equity line of credit.

Speaking of a home equity line of credit, if you room in your line of credit, i.e. your line of credit is larger than the current balance outstanding, that will be the easiest way to consolidate credit cards. That assumes that the available balance on the line of credit is greater than the balances of your credit cards you want to consolidate or pay off.

If you own a home and have sufficient equity in it, even if your credit is not very good, you can consolidate credit cards much easier than someone that doesn't own their own home. Talk with your current mortgage, second mortgage company, or home equity line of credit company first to see what kind of deal they will offer you. Before you accept their offer, check with other lenders to make sure you are getting competitive interest rates and closing costs. You will find a lot of variance, be careful.

Even if you don't own your own home you can still consolidate credit cards, but it will require more work and determination on your part to get the job done. If one of your credit cards has a reasonable interest rate and you've paid your bill with them in a timely fashion, give them a call and see if they will increase you credit line so you can transfer the balances from your high interest credit cards to the one with the good rate. Depending on the credit card company this may be a viable option and certainly the first one to investigate when you are consolidating credit cards.

If that doesn't work, you can try a debt consolidation counselor. Frequently, these are non-profit operations that will work with your credit card companies to reduce your interest rate and get lower monthly payments so you have room to breathe. Even though the companies are non-profit they do charge a fee for their services to cover their costs.

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Consolidate Your Credit Cards

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