Beat debt with credit card consolidations

Tuesday April 22, 2008

You may be able to reduce credit card debt simply by consolidating your existing balances onto a new card with an interest free balance transfer period. Credit card consolidations performed in this manner can freeze the increase of your debt, while also possibly providing a lower minimum monthly repayment than for all your cards together for the months when you can't afford a large repayment.

When choosing a credit card for credit card consolidations, you should take a few things into consideration. For instance, does the new credit card have a reasonably long interest free period for the transferred balances? Next you need to ask if you can stop using your card to spend for that period of time. It's necessary to discontinue spending on your card while you repay your credit card consolidations, as generally all repayments will be applied to the transferred balances first leaving your new purchases to accrue debt once any interest free period expires.

For effective credit card consolidations for debt reduction, you may also need to consider the interest rate of the card after the interest free balance transfer period has expired if your debt is particularly difficult to repay in full. Also, if you apply for a credit card with an excellent balance transfer offer but an awful ongoing rate then you could end up in a similar position in the future. The St George Vertigo MasterCard offers an excellent balance of interest free balance transfers for 6 months and a very low ongoing purchase rate of 10.99% p.a. This is quite generous, as many cards charge their cash advance rate on balance transfers not repaid in the interest free period.

Please visit our comparison page for a collection of some of the best cards for credit card consolidations.