How to Do Credit Card Debt Consolidation

by : Jon Arnold

Knowing that you are in a financial pickle and need to find some way to do credit card debt consolidation is not an enviable place to be, but I am sure you did not choose to be there. Nonetheless, that is where you are at right now and you need to understand what your options are to get out from under this huge financial burden, which is also causing stress in your life and your relationships.

There is little doubt that you have considered bankruptcy. Popular wisdom believes that bankruptcy is a slick way out to enable you to eliminate all your debt and start over from square one. But consider the fact that that same popular wisdom also believes in Santa Claus and the Easter Bunny. The new bankruptcy laws make it make more difficult, painful, and expensive to file bankruptcy, and the virtual mountain of paperwork you need to complete to do so will keep you from the tasks you need to perform to get yourself back on track for weeks or more at a time. For some, bankruptcy may actually be their most viable option, but for the majority of people who are just simply looking for a way to do credit card debt consolidation, there is a much easier way. If you are trying to kill a fly, you do not need to take measures as drastic as dynamite - while that WILL kill the fly, it will also do much more damage to many other things that are much harder to repair.

There are two situations you could be in right now. One is that you can see that you are going under from a financial standpoint but you are still (just barely) treading water. The second is that you faced the problem head-on and decided to run the other way, in which case you already have accounts past due and possibly also in collections.

Credit card debt consolidation can help with either of those situations. Even the latter situation does not typically require a step as drastic as bankruptcy. This is sometimes also known as bad credit debt consolidation, but regardless of what it is called, it can help you get out from under this burden.

There are multiple steps involved. First you need to find a company that specializes in credit card debt consolidation. If you do not live in a major metro area, you may have to look in a more major metro area, or you could look online. When you have found some candidates, check with the Better Business Bureau to make sure there are no outstanding complaints against the company, since the last thing you need to do right now is make another mistake.

Although the credit card debt consolidations are very similar, they are not identical. Compare the programs and rates and choose the one that appears to work best for you. What will happen is that you will turn over all your credit card bills to the debt consolidation company. They will issue you a debt consolidation loan, but they do not give you real money. What they are really doing is a management service. You will be paying ONE payment every month to them, and they will divide up that payment to make payments to your creditors.

It really cannot get easier than that and your credit score will also not go down the tubes as it does with bankruptcy. But you need to make sure that you make your payment every month to the debt consolidation service. Get into the habit of paying them on time each month, and when that loan is paid off, hopefully you will be wiser for all the troubles, and take the "make payments on time" mantra with you in the future.