Credit Card Consolidation

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Credit cards have changed the spending behavior of consumers. Without a doubt, credit cards have benefited credit card holders by providing them with ready and easy access to credit. However, this easy access to credit may also be a disadvantage, that is, when customers begin to rack up debt. To deal with this, one option for credit card holders is credit card consolidation. Credit card consolidation allows balances from several credit cards to be aggregated into a single account. The aggregate balance will be paid for by the third party company that offers credit card consolidation. Credit card consolidation allows credit card holders to manage their account better by having to pay only one institution and receiving only one statement of account. Also, the credit card holder no longer has to mind varying finance charges for several credit cards, the consolidated account is charged with a single interest rate. Credit card consolidation is a viable option for card holders who are looking to eliminate or reduce their debt.

Credit card consolidation benefits credit card holders in a lot of ways. Perhaps the best benefit derived from credit card consolidation is smaller interest rate charged to the consolidated account. This interest rate is often much lower than finance charges charged by credit card companies. The reason for the cheaper rate is that companies offering consolidated credit require mortgage as collateral. Also, different credit card companies charge different rates; with consolidated credit card balances, the consumer no longer needs to monitor several accounts for varying rates.