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Step 1
If you are in over your head in debt from credit cards, consolidation with a loan might be the best option. Contact your local banks and credit unions and let them know what you are intending to do. They will quote you a personal unsecured loan to transfer all of the debt to. This means that you will cancel all the credit card accounts and instead have one payment on a loan. If you have a lot of debt they may recommend credit card consolidation with a secured loan such as a second mortgage.
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Step 2
If you are just struggling to make your payments or just recognize a need to get rid of the debt then you will want to use this process. Make not of all of your balances, interest rates and limits on a piece of paper. You will use this for the rest of the credit card consolidation process.
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Step 3
Call the company that is offering the lowest rate with the highest balance. Let them know that you want to do a balance transfer from all of your other cards to this one in order to do credit card consolidation. Ask if they have special rates for balance transfers. They will likely have to upgrade your account in order to accomplish this, but it will be worth it.
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Step 4
Do a balance transfer from all your cards to the one card with the raised limit. Then cancel all the other cards. Canceling the others is the biggest part of credit card consolidation because if you don’t, you are likely to rack up more debt because of the available balance.
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Step 5
Institute a payoff plan. Determine an amount that you are able to spend in addition to your monthly payment to put on the card. If you pay only the minimum, you will never pay off the debt and the credit card consolidation will have been in vain.
