Credit card consolidation is a process where someone with debts on more than one credit card combines these debts into one, paying interest to just one lender instead of several. Usually this new lender offers a lower rate of interest and this can save a significant amount of money in interest payments. Consolidation can also save time since there is just one lender to make payments to.
Credit card consolidation can require collateral, and as the risk to the lender is lower, the interest rate is usually lower. Unsecured consolidation generally carries higher interest rates to reflect the higher risk to the lender. Credit card debt consolidation which is secured against your home has one major downside. If you don’t keep up the repayments on a secured consolidation you can lose your home.
See the author’s site for for information on how to consolidate credit card debts.
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