Credit Card Debt Consolidation - Doing It The Right Way

Credit card debt consolidation has become a huge business for banks and credit card companies. Just take a look at all the advertisements you see and hear on TV and the radio... to say nothing of newspapers, magazines and the Internet. You couldn't get away from them even if you tried. With the average American consumer holding $9200 in credit card debt, balance transfers and debt consolidations have broad appeal.

But be careful not to let the slick sales pitches and clever ad campaigns of the various competing credit card issuers sway you into choosing a deal that isn't right for you. Although they may seem to be quite similar on the surface, all credit card debt consolidation offers can, and do have distinct differences. Choosing the right offer depends on how much debt you hold and what you are looking to accomplish. In other words, it's all about you.

We have seen financial services companies promoting home equity loans as a viable way to pay off credit card debt. It most definitely is an option to consider. There are definitely some tax advantages to using your home's equity to secure a loan. But by the same token you must be careful. You must be 100% sure that you can repay that loan. Missing, or being late on credit card payments will hurt your credit ratings, but defaulting on a home equity loan can result in you losing your home.

Some people don't have the luxury of tapping into a home equity loan, while others prefer not to. The fact is that most people prefer to consolidate credit debt by taking advantage of balance transfer credit card offers. All of the leading credit card issuers now have balance transfer options. The offers include low interest or 0% APR for an introductory period. These introductory periods typically last between 6 - 12 months. Taking advantage of these offers can save you hundreds, if not thousands of dollars on interest payments.

Another advantage of using a balance transfer credit card is that you can use the money you are saving on high interest rates and apply it to the principal. That will help you pay off your credit debt quicker. The ideal scenario, of course, is that you completely pay off your credit card debt before the introductory offer expires.

Nothing drains your bank account quicker than high interest rates. By employing sound financial strategies you can cut, if not eliminate, interest. And by exercising self-discipline, pay off the principal and become debt free. It may not be easy, and it isn't going to happen overnight, but with direction and dedication, credit card debt consolidation can help you achieve financial freedom.