Debt Consolidation


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Debt consolidation elimination is a way to reduce your credit debt and pay off the bills. We know that it’s good to consolidate debt (at least that is what we keep hearing from everyone). In fact, the first step towards addressing the problem of debt is to consolidate credit card and other debt. Now, how do you do to consolidate debt? Should you just go with that attractive ad in the newspaper that says ‘…the lowest APR in the town is available here’?

The most important step to debt consolidation elimination, really, is to keep your eyes and ears open. There are always a number of offers available for you to choose from. The credit companies keep coming with new and more attractive offers asking you to consolidate debt with them. However, you must note that the APR quoted in bold, e.g. 0% APR, is applicable only for a short term (3-9 months). The long term (or the standard) APR is different. So, when you go looking for a credit card to consolidate credit card debt, you must be keenly looking for these 3 things (in terms of APR) – introductory APR, introductory APR period and the standard APR. Let’s see how each one is important.

Introductory APR is probably the most attractive thing to look for when you are looking to consolidate credit debt. If you consolidate credit debt to a card that has a low introductory APR e.g. 0%, the first thing you get is a breather/relief in terms of the rate at which your credit card debt has been growing. Based on how long that 0% APR period is (generally you will look to consolidate credit card debt with a credit card supplier who offers 0% initial APR), you will at least be able to temporarily break the growth rate of your debt.
You should not ignore the standard APR when you consolidate credit debt. This is the interest rate that will be applied to your balance after the expiry of the introductory low APR period that was given to lure you to a debt consolidation elimination program. If the standard APR is too high and you know that you will not be able to clear off the entire debt during the low APR period, that deal is probably not the best for you to consolidate debt. However, if you think that you will be able to clear off the debt during that period, you can make some compromises on the standard APR of the debt consolidation elimination program to.

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We are about 00.00 in debt with alliance one and i think 0.00 in capitol one. We have a debt consolidation with Federated Financial. But I was thinking that maybe we should just settle with both of the debts ourselves because federated financial charges .00 a month and it will take us like 3 years to pay it off, if we go through them. What is the best choice?

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