Define consolidating credit card debt

There are many ways to consolidate your credit card and other debt, such as with a 0% APR credit card, a home equity loan or a personal loan.

The option that best suits you will depend on your credit, available cash and other aspects of your financial situation, as well as your personality. What to do if your debt is insurmountable Get ready to tackle your debts Your options for debt consolidation Ask yourself a few questions to see if debt consolidation is really what you need: Am I serious about paying off my debt?

Debt consolidation is a third-party payment system. Agencies range in quality so make sure you shop around. Most debt consolidation plans are structured the same way. They ensure member agencies pass rigorous standards set forth by the Council on Accreditation or another approved third party, and that their counselors pass a comprehensive certification program. Financial institutions don't give preferential treatment to any one organization, nonprofit or otherwise.

However, if you just happen to have accounts with creditors that don't offer any concessions, that benefit is reduced. Look for a nonprofit credit counseling organization that belongs to either the National Foundation for Credit Counseling (NFCC) or the Financial Counseling Association of America (FCAA).

By consolidating credit cards debts you narrow down the creditors to just one, one that isn't easily forgotten or miss places each month!

Consolidating credit cards debt is not going to allow you to get rid of them immediately, but it is going to give you a path that will take much less time.

The agency should be organized, send payments and statements on time and offer strong consumer education and support. The payment is usually around 2.5 percent of the total debt, though in hardship situations, there is some wiggle room. Why consolidate bills if you can't pay for basic expenses or if there are better alternatives?

You can stop the plan at any time, and you can also pay more -- and get out of debt faster -- when you have extra funds. You wouldn't, which is the reason consolidation begins with a counseling appointment where your entire financial situation is assessed.

If you have enough cash left over after subtracting expenses from income, consolidation will be presented along with other options. How do you know if a debt management plan will work in your favor?

When a counselor is knowledgeable and compassionate, these sessions can be enlightening and motivating. If he or she acts bored, judgmental or pushy, request a different counselor. First, the bulk of your balances should be in unsecured debts, such as credit and charge cards, personal loans and, sometimes, collection accounts.

Debt consolidation allows borrowers to roll multiple old debts into a single new one.

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