Credit card debt can be the most costly kind of personal debt consumers can run up. Interest rates on credit cards are constantly going up, and once you get into that routine of using credit cards it can be difficult to get out of. Consolidating your credit card payments can help you lower your monthly payments by lowering your interest rate and monthly service charges, and it can help you begin to pay off the debt you have accumulated. There are several ways to easily consolidate your credit card debt.

Zero Interest Credit Cards

It may sound strange to recommend consolidating credit cards by using a credit card, but some of the deals offered by banks make this option worthwhile. To get you to use their credit card, a bank may offer you the chance to transfer all of your existing credit card debt to their card at zero percent interest. You can save a great deal of money going from double-digit interest rates on your current cards to a zero percent interest consolidation card. The key is to not use the new card once the debt has been consolidated. After you have made the balance transfers, simply cut up the new card and never use it. You can pay for your purchases with the cash you will be saving each month. This a good way for people who do not own a home to consolidate their credit card debt. Before using this option, make sure you understand how long the zero interest period lasts before the bank imposes a regular credit card interest rate.

Personal Loan

Personal loans can be a good way to consolidate your credit cards as well. Chances are very good that you will get a better interest rate on a personal loan than you have on your current credit cards, and having a personal loan is a good way to build your credit. There are two types of personal loans: secured and unsecured. A secured loan requires personal property to become collateral to secure the value of the loan, and an unsecured loan does not require any collateral.

Home Loans

If you own a home and have equity in that home, or you have owned your home for a long time, then you may be able to use your home for a credit card consolidation loan. If you have enough equity in your home to get a home equity loan to pay off your credit cards, that would be a good way to reduce your monthly debt. If you have owned your home for awhile, you may be able to refinance your mortgage for the current amount of your home and use the extra money to pay off your cards. Be certain that the interest rate on whichever home loan you get is better than the rates on your credit cards.

Source:

LendingTree.com - Creating A Debt Consolidation Plan

Federal Trade Commission - Knee Deep In Debt

Bankrate.com - Debt Consolidation