Borrower Beware ! : My Opinion , its a TRAP! and it will trap you for life like Student loans ! What do I need to know if I’m thinking about consolidating my credit card debt? When you consolidate your credit card debt, you are taking out a new loan. You have to repay the new loan just like any other loan. If you get a consolidation loan and keep making more purchases with credit, you probably won’t succeed in paying down your debt. If you’re having trouble with credit, consider contacting a credit counselor first. Consolidation means that your various debts, whether they are credit card bills or loan payments, are rolled into one monthly payment. If you have multiple credit card accounts or loans, consolidation may be a way to simplify or lower payments. But, a debt consolidation loan does not erase your debt. You might also end up paying more by consolidating debt into another type of loan. Before you use a consolidation loan: Take a look at your spending. It’s important to understand why you are in debt. If you have accrued a lot of debt because you are spending more than you are earning, a debt consolidation loan probably won’t help you get out of debt unless you reduce your spending or increase your income. Make a budget. Figure out if you can pay off your existing debt by adjusting the way you spend for a period of time. Try reaching out to your individual creditors to see if they will agree to lower your payments. Some creditors might be willing to accept lower minimum monthly payments, waive certain fees ,reduce your interest rate, or change your monthly due date to match up better to when you get paid, to help you pay back your debt. Here’s what you need to know if you are considering loan consolidation: Credit card balance transfers Many credit card companies offer zero-percent or low-interest balance transfers to invite you to consolidate your debt on one credit card. What you should know: The promotional interest rate for most balance transfers lasts for a limited time. After that, the interest rate on your new credit card may rise, increasing your payment amount. If you’re more than 60 days late on a payment, the credit card company can increase your interest rate on all balances, including the transferred balance. You probably have to pay a “balance transfer fee.” The fee is usually a certain percentage of the amount you transfer or a fixed amount, whichever is more. If you use the same credit card to make purchases, you won’t get a grace period for those purchases and you will have to pay interest until you pay the entire balance off in full (including the transferred balance).