Make Your Credit Card Debt Affordable | Debt Consolidation

By MartinTan
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Credit card debt is a growing problem, with several companies reporting over 50% of their accounts being 90 days or more past due. If you are one of those people who have overextended yourself with credit cards and can't figure out what to do, a credit card loan consolidation program might be just what you need.

With a credit consolidation program, the goal is to take all of your loans and to combine them into one monthly payment that you can pay off in just a few years (about 3-6 years in most cases). By consolidating your debt you can often qualify for a lower rate on the single loan because of the larger amount.

Before you agree to consolidate, always do your homework to make sure the new loan isn't costing you as much or more than the individual loans were. There are disreputable companies out there that will try to avoid giving you the best rate, so shop around before making a decision and don't sign on the dotted line in an emotional moment only to regret it later. By figuring the total monthly payments you are currently making you can easily compare that to the proposed consolidation amount, thus determining which the best option for you is.

When you have a consolidation loan, it is very important that you make your monthly payments on schedule. Your payments will no longer be sent to your creditors. Instead, you pay the consolidation company who then in turn pays the creditors on your behalf.

Late payments will put the loan status in jeopardy and the creditors may have the option of resuming collection activities or increasing the loans interest rate as a result. Stay in touch with the assigned credit counselor (or "consolidation specialist") and keep him/her abreast of any situations or changes. This will prevent the account from being returned to collections for payment.

The consolidation program will make the loan payments and reviewing monthly statements for accuracy is your responsibility. Statements should reflect a reduced interest rate and the account should no longer accrue late fees or other charges. Contact the assigned counselor regarding inaccuracies and incorrect payment amounts so these issues can be corrected. This will ensure that the company is paying creditors the correct amount and resolve problems.

Debt consolidation loan programs vary and picking the right one will depend on the individual situation. Some programs may have a higher monthly payment over a short period of time while others may offer lower payments spread over several years. Let common sense prevail. Look for the loan with a monthly payment that is affordable.

Some companies offer a fixed interest rate and disallow making extra payments over time. If at all possible, find a loan consolidation program that will allow you to pay more when you can!

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Want to know more about loan consolidation? Go to www.allaboutloanconsolidation.com and learn about Credit Card Counselling, unsecured loan consolidation and other related subjects.

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