Credit Card Consolidation – The Right And Wrong Alternatives

If you’re over the age of 12 – and you probably are since you’re reading this article – you’ve already learned that in most cases there are two ways to do things. They are the right way and the wrong way. As an example of this, if you have a leaky faucet the wrong way to fix it is to keep tightening it until something breaks, while the right way would be to take everything apart and replace the faulty washer that’s causing the leak.

A living nightmare

If you’re seriously in debt to credit card companies, your life could be a living nightmare. You may be receiving threatening phone calls from your credit card companies or debt collectors at all hours of the day and night. You may be having a problem sleeping because you’re so concerned about those debts. Or you might even be suffering physical symptoms because of the stress you’re feeling.

Consolidation to the rescue

Credit card consolidation can be a very good way to get those credit card debts under control and to get your life back. The upside of consolidation is that it can lift that burden of debt off your back practically instantly. However, you need to be aware that there is a right and wrong way to do credit card consolidation.

The wrong alternative

For many families the wrong way to do credit card consolidation is through a loan. Yes, a debt consolidation loan can provide almost immediate relief from your debts but there are some negatives you need to understand.

First and foremost, you may not be able to get a loan large enough to pay off all those debts. Bankers tend to be very hesitant about loaning money to people who are already deeply in debt. It’s kind of like adding water to a bucket that’s already full. If you are able to borrow enough money, it will probably be a secured loan or one where you have to put up an asset such as your house as collateral. Of course, if you don’t own a house, this would be a nonstarter.

Second, a consolidation loan does not eliminate any of your debt. What it does is move it from one set of creditors to a new one – the bank or credit union where you got the loan. It will probably take you anywhere from 7 to 10 years to pay back the loan, which is a very long-term commitment. Plus, the loan will end up costing you more money because it takes so much longer to pay it off.

The right alternative for credit card consolidation

There is a right or better way to do credit card consolidation, which is through debt settlement. However, to do this means you need to have nerves of steel because you will need to stop making payments on your credit cards for at least six months. You would then contact your credit card companies and offer to settle your debt on the spot but for maybe 50% less than what you actually owe. Credit card companies will often agree to this kind of settlement if and only if you can convince them that it’s either this or you will file for bankruptcy, in which case they would get nothing.

Let us settle your debts for you

The biggest negative of do-it-yourself debt settlement is that you must have the cash on hand to actually settle your debts. In other words, if you were able to negotiate a $5,000 credit card debt down to $2,500, you would have to have $2,500 ready to either wire to the credit card company or send via a cashier’s check. Most families who are having a problem with credit card debt simply don’t have this kind of cash available. This is why they turn to companies like National Debt Relief to settle their debts for them. We’ve saved our clients thousands of dollars, helped them get out of debt in 24 to 48 months, and provided payment plans they could afford – meaning they didn’t have to have thousands of dollars in cash on hand to settle their debts.
If you’re interested in doing credit card consolidation the right way, call our toll free number today so that we can get started eliminating your living nightmare.