‘Credit card debt consolidation’ seems to be a buzz word in the world of credit cards. There is no doubt that credit cards have been very helpful and handy for us and we, in fact, treat the credit cards as a necessity. Nevertheless , with every good you have evil too. In the world of credit cards, ‘Credit card debt’ is that evil and ‘Credit card debt consolidation’ is often considered to be a cure for treating credit card debt.
Any person who has read any newspaper articles on ‘Credit card debt’ would already know what credit card debt consolidation is. Nevertheless , just for the benefit of others, credit card debt consolidation, in plain words , is the process of consolidating debt which you have on various high APR credit cards onto just one low APR credit card. So , the most important advantage of credit card debt consolidation is realized in terms of APR reduction (and hence reduction in credit card debt increase rate). This is touted as the most important benefit (and sometimes the only advantage ) from credit card debt consolidation. Nevertheless , credit card debt consolidation comes with some other benefits as well. Some of these credit card debt consolidation benefits are widely advertised by the credit card suppliers and some not so much:
1. Initial APR: As we’ve already said , lower APR is the biggest benefit from credit card debt consolidation. As credit card suppliers use credit card debt consolidation as a way to attract customers , they usually offer a 0% APR for an initial period of 6-9 months after you join their credit card debt consolidation program i.e. first several months after you receive the new credit card.
2. Standard APR: Lower standard APR (i.e. the long term APR) is the other significant advantage from credit card debt consolidation. Though not all credit card suppliers offer a lower standard APR with credit card debt consolidation some do design credit card debt consolidation programs with good standard APR. These credit card debt consolidation programs offer a trade-off between initial and standard APR rates.
3. 0% on purchases: This is another common advantage from credit card debt consolidation. The 0% interest (or some lower percentage) on purchases is offered as motive for credit card debt consolidation. Such a credit card debt consolidation advantage is again applicable only for a short initial period.
4. Easy management: This credit card debt consolidation advantage is much less popular than others. Nevertheless , one advantage of credit card debt consolidation (from multiple to single credit card) is having to deal with a lesser number of credit cards.
5. Other advantages : The credit card debt consolidation exercise might bring you some more benefits in terms of rebates, discounts and reward points ( especially if get a co-branded card as part of credit card debt consolidation)
Learn more about Debt Help topic on this Debt Consolidation Loans.
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