Consolidating credit cards

[tgeorge0207]

Has anyone ever done this......... my credit union has consolidation loans for credit cards but I don't know much about it. It is a small credit union as only certain ppl in certain professions can use it...... do they make you cancel the credit cards or do you keep them....... any info would be great thanks.

 

[lisajl]

We did this years ago and it helped us out. A lot of people (suzi orman) say not to do it. We kept our cards, just put them away and did not charge anymore. If you can get a lower rate than your credit card charges maybe you should try it.

It has been over 10 years since we did this.

 

[davedmaine]

Has anyone ever done this......... my credit union has consolidation loans for credit cards but I don't know much about it. It is a small credit union as only certain ppl in certain professions can use it...... do they make you cancel the credit cards or do you keep them....... any info would be great thanks.

Be careful. You're fighting with fire. What makes these loans appealing to people is that they feed upon the tendencies that got people in trouble in the first place. I wouldn't recommend it if you can avoid it..

 

[Marionnette]

Has anyone ever done this......... my credit union has consolidation loans for credit cards but I don't know much about it. It is a small credit union as only certain ppl in certain professions can use it...... do they make you cancel the credit cards or do you keep them....... any info would be great thanks.

A consolidation loan won't make you cancel your cards. That kind of action is usually part of a debt management program. A consolidation loan is entirely different. The bank loans you a sufficient amount of money to pay off your credit cards (sometimes more, if you qualify and ask for it). What you end up doing with the money is your business.

The purpose behind the debt consolidation loan is to pay off the high-interest credit cards with the loan money, which has a lower interest rate. The problem that people get into when they do these kinds of loans is that they retain those credit cards that got them in trouble to begin with. They end up charging up those cards again and not only do they have the consolidation loan to deal with, they also have the new credit card debt to face. So, even if your credit union doesn't make you cancel your credit cards, it might be a good idea to do it on your own. Maybe keep one for absolute emergencies.