“Credit Consolidation” — What It is, Reviews & Loans (8 Best Companies 2017)

“Credit Consolidation” — What It is, Reviews & Loans (8 Best Companies 2017)
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Linsey Knerl
By: Linsey Knerl
Posted: March 1, 2017
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Perhaps you feel overwhelmed by the amount of money you owe on various credit cards. Minimum monthly payments may be hard to make, or they may not move the needle much on your total debt owed. If you’ve found yourself in the situation of dreading your monthly credit card payments, you may have become curious about credit consolidation.

Here’s a brief explanation of what it is and how it can be used to help you dig out from under debt in a responsible way.

Definition | Reviews | Loans | Nonprofit Counseling

What is Credit Consolidation?

Credit consolidation is also referred to as “debt consolidation.” It’s a program designed to transfer all your credit card balances to one lender, with the goal of reducing your interest rate to one manageable annual percentage fee.

The benefit to this service is that it streamlines your debt payments to take place in one lump sum each month. You don’t have to track down various payment dates and amounts. You can sometimes also lessen the total interest paid, as many programs offer interest rates lower than what you’ve likely been paying through individual credit accounts. This means a shorter payoff time for your total debt and less financial “clutter.”

The Best Credit Consolidation Company Reviews

As you would imagine, no two credit consolidation companies are created equal. You should carefully consider a company’s BBB rating, reputation, and record of results before committing your credit accounts to their care. The best organizations in the industry are those that are equipped to handle any number of debt management needs. They include:

  • Requires $10,000 or more in credit card debt
  • Free, no-obligation debt analysis
  • Specializes in credit card and medical debt
  • Also handles debt from personal loans, private student loans, lines of credit, and collections
  • Does not handle IRS, utility, federal student loans or mortgage debt
  • Long-term program to relieve debt over 24-48 month period
  • Click here for sign-up form, terms, and details.
       
★★★★★

4.9

Overall Rating

Better Business Bureau In Business Since Free Consultation? Reputation Score
A+ 2009 Yes 9.5/10

National Debt Relief has quickly become one of the largest and most reputable debt relief companies in the country, with thousands of positive customer reviews.

Contact Consolidated Credit Counseling to schedule a completely free and confidential debt analysis with a certified credit counselor to determine the best plan of attack for your situation.

  • 100% confidential, no-obligation consultation
  • Specializes in credit card and loan debt over $10,000
  • In business since 2000
  • Options for debt settlement, consolidation, bankruptcy, and tax debt
  • Get a 100% free, personalized savings estimate from a debt professional
  • Click here for sign-up form, terms, and details.
       
★★★★

4.0

Overall Rating

Better Business Bureau In Business Since Free Consultation? Reputation Score
(No Grade) 2000 Yes 9.0/10

CuraDebt has counseled more than 180,000 people since 2000, helping them to pay back credit card, medical, tax, and other unsecured debts.

Freedom Debt Relief is the largest debt relief company in the nation, having just recently hit the $5 billion mark in total debts resolved.

Read the full reviews for each of the top credit consolidation firms before you decide.

A Personal Loan for Bad Credit May Be an Option

Traditional debt consolidation is a solid choice for getting your debt under control, but it’s not for everyone. If you would like to keep your credit accounts and the benefits that come with them, you may wish to take out a personal loan with a low-interest rate and use it to pay off your credit accounts.

Our top three personal loan providers below have shown to have excellent loan terms and specialize in approving those with poor credit:

   
★★★★★

4.9

Overall Rating

Loan Amount Interest Rate Loan Term Loan Example
$1,000 to $10,000 5.99% - 35.99% 3 to 60 Months

See representative example

A personal loan has the added benefit of giving you full control of your accounts, payments, and negotiations with lenders. This option is not intended for someone with a hard time making payments. It is up to you to apply the funds from your new loan to your credit accounts. There is potential to get further into debt if you’re not careful.

Nonprofit Credit Consolidation Programs Are Not Free

There are plenty of nonprofits that provide credit consolidation for those with credit card debt. Two of the most popular nonprofit credit consolidation programs are currently Christian Credit Counselors and the NFCC.

While these programs can cost less than a for-profit company, this is not always the case. Some companies will add a monthly service fee to your payments, an upfront activation fee, or require a donation made to a nonprofit charity for their overhead fees. They can cost as much as a for-profit when all fees and charges are figured in.

Change Your Spending Habits to Remain Debt-Free

With so many choices available for getting your credit accounts paid off, it can seem like your debt troubles are temporary. With proper changes to your financial habits, this is a possibility! Many who complete a credit consolidation program can maintain healthy spending habits for a lifetime, and are able to begin using credit again after they have completed the program.

It’s vital, however, that you take a good look at how you got into heavy debt in the first place. Use those lessons to change future behaviors, stick to a budget, and start a new journey that uses credit wisely. Enlist the help of a financial planner or another money expert, if needed, until those changes become habit.