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Consolidate Credit Card Bills
Bertha Said:Is it better to consolidate credit card bills with a higher interest or have multiple credit card bills?
We Answered:I don't see how it's ANY advantage to consolidate your bills to a credit card with a higher interest rate and a pay-off date.
It's MUCH better to have multiple bills with the lowest interest rates you can get. What do the rates increase to after 2011? That's still 3 years away, you should be trying to pay off as much as possible on your cards. Pay MORE than the minimum, even an extra $10 a month helps.
But there is actually hope for you, now that you've stopped the cycle of charging your cards and spending money that you don't have. Most people ignore this step when trying to get out of debt, and even if they do make it out, they haven't changed their spending habits and end up right back where they started from.
Here are a few "snowball" calculators that might help you figure out how best to handle multiple debt, and also show you the affects of slightly increasing the payments on the time it takes to pay them off and the total interest generated. I'd always go with paying off the higher-interest cards first as opposed to paying off the higher-balance cards; you'll save money overall, but I won't ignore the psychological boost from reducing the number of debts you have left.
Edgar Said:do those companies that consolidate credit card bills effect your credit score?
We Answered:think -- why do into more debt to get out of debt -- like throwing gas on a fire to put it out. set down, make a list of all the things your can do with out and still survive -- cell phone, internet, eating out -- these things along will help toward reducing debt. you can work this out by yourself will that time and a strict money management process.
Nina Said:Does anyone know of a safe way to consolidate credit card bills without getting bad credit?
We Answered:Stay away from any "debt consolidation" company that promises to cut your debt and payments in half through debt settlement....This is a risky tactic of deliberately ceasing all payments to creditors and forcing your accounts into default to attempt settlements. You pay a monthly fee to a debt consolidator....this entire fee goes towards building a settlement account and to the consolidator's fees to “settle” your accounts in the future. Your credit card companies will deliberately not be paid so that all the accounts will default/charge-off so that they can attempt settlements at around 50%. If you are current on your accounts, this process will ruin your credit rating for sure. Debt settlement is like a roll off the dice with your finances...You can never predict how your creditors will respond to the deliberate defaulting of your accounts...they might settle at 50%...or they might serve you a summons, take you to court...and if they win, you could be looking at wage garnishment.
Many people who sign up with “debt consolidation” firms incorrectly assume that they have the power to force your creditors to accept settlements...they don’t. Your creditors have the right to refuse settlements and take you to court.
See this as an example of what can go wrong with debt settlement:
One option is entering a Debt Management Plan (DMP) with a non-profit credit counselor like CCCS (Consumer Credit Counseling Services). Contact your local Red Cross for a referral to the local Consumer Credit Counseling Services (CCCS). They can negotiate reduced interest and payments. They will require you to stop using all credit and to cut up your cards. Your credit report will be updated to "enrolled in debt management." This does not damage your credit, but it may make it difficult to obtain new credit while you are enrolled in their program....so don't use this service if you anticipate applying for a new apartment, car loan or mortgage anytime soon, as you would might be denied while you're enrolled in the CCCS debt management program...
Lisa Said:I would like to consolidate my credit card bills, how do I do that?
Olga Said:I want to consolidate credit card bills , which card should i transfer them onto.?
We Answered:Use whichever card you don't plan on making any other purchases on, until the transferred balance is paid off. Until the credit card reform takes effect next year, the credit card companies will apply your payments to the lowest interest items first. So if you have a transferred balance at 0%, and make purchases at 10%, the payment you make at the end of the month will apply to the 0% balance, and you will accrue interest on the purchases.
If that's not a factor, I'd suggest the 0% APR, assuming you will pay it off in full before the intro rate expires. If you can't pay it off before the intro rate expires, then you may be better off with the 4% card, especially if it stays at 4% until the balance is paid in full. Often with the intro rates, it stays at 0% for a while, but once it expires you get charged the standard interest rate (usually pretty high for transfers) for the outstanding balance from the time the transfer was made, not when the intro APR expires.