Card Consolidation: The Better Compromise

2007-03-08 10:33:40

( Financial )



DEEP IN CARD DEBT

The concept of card consolidation came about as credit cards became more and more accessible to individuals, so much so that it was normal for a household to use several credit cards at the same time.

The problem began when people began spending so much on their credit cards without any regard for how it will be paid and the interest rates that accumulate as a result of the arrears in payment. Thus more and more people found themselves deep in credit card debt with no end in sight.

As a way to help those with multiple card debts and at the same time recoup their losses, banks and credit institutions began offering consumers the option for card debt consolidation. This is for those individuals who have more than one credit card and have outstanding balances on each one of them.

CLOSING YOUR CARD DEBTS

The idea behind card consolidation is very simple. Rather than having to pay three or four credit card bills a month to different credit card companies, you will pay one single payment with one single lender. One simple payment on a regular basis is less overwhelming than having an endless stream of credit card bills arriving at your doorstep month after every month.

The card debt consolidation will pay off all your existing credit card debts, and you in turn will have to pay the card consolidation company an amount that depends on the total card debts that they have consolidated for you plus interests and service charges. If you have a third-party card consolidation provider, they will also be the one to mediate with the credit card company and haggle for better terms in order to close the card debt.

Credit card companies are more often than not willing to work with card debt consolidation programs because it works to their interest if clients are willing to pay off and close their debts. Card consolidation services offer a win-win solution that benefits all parties concerned.


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