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5 Tips for Consolidating Credit Card Debt

December 18, 2013 by Lucy Lazarony

5 Tips for Consolidating Credit Card Debt

Feeling weighed down by high-interest credit card balances? These debt consolidation tips can help.

1. Check your credit

Review your credit reports and correct any errors. An error on your credit report could prevent you from qualifying for the debt consolidation help that you need. Credit.com's free Credit Report Card can help you understand what's inside your credit report, and gives you your free credit scores, too. Get a free annual credit report from each of the three national credit reporting agencies.

2. Consolidate to a low-interest credit card

If you've got good credit, look for a credit card with a low-interest rate. Transfer high-interest rate credit card balances to a single card and save money on monthly finance charges as you pay down your debt. For consumers with good credit there are several balance-transfer and low-interest rate credit card offers available.

3. Get a loan from a local bank or credit union

You may be able to consolidate your debt with a personal loan from your bank or credit union. Ask the loan officer at your financial institution for more information.

Before applying for a loan, ask about the lender's credit requirements. Is there a minimum credit score for qualifying for a loan?

4. Get a consolidation loan from an online lender

Choose a reputable lender when applying for a debt consolidation loan online. Check out any potential online lenders with the Better Business Bureau and look for complaints. And check to see if a lender is registered to do business in your state by contacting your state Attorney General's office or your state's Department of Banking or Financial Regulation.

Beware of any lender that promises to make you a loan regardless of your credit. Stay clear of websites and lenders that charge you big upfront fees for a debt consolidation loan.

5. Sign up for a debt management plan

Reach out to a credit counseling agency about a debt management plan. With a debt management plan, you make one monthly payment to a credit counseling agency and the agency pays each of your credit card lenders. A lender may lower the interest rate on your credit card balance when you participate in a debt management plan.


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Meet Our Experts

Lucy Lazarony Lucy Lazarony is a freelance personal finance writer. Her articles have been featured on Bankrate, MoneyRates, MSN Money, and The National Endowment for Financial Education. Prior to freelancing, she worked as a staff writer for Bankrate for seven years. She earned a bachelor's degree in journalism from the University of Florida and spent a summer as an international intern at Richmond, The American International University in London. She lives in South Florida.