Best options for consolidating credit card debt

Your credit utilization counts toward 30% of your credit score, and that’s why it’s important to keep that ratio low — under 30% and, optimally, less than 10% of your credit limits, overall and on individual cards.Keep in mind a debt management plan may have a negative impact on your credit during the course of the program because your creditors will close or suspend your accounts while in the program, and this can affect your credit utilization.Promotional interest rates expire — like 12 months of a 0% APR on a balance transfer card — so make sure you can repay your debt within that time frame. Failing to pay a personal loan as agreed will hurt your credit, so stay on top of your loan payments and work to build up a solid payment history.

Keep in mind that you’ll need excellent credit to qualify for the lowest interest rate on a personal loan.

A lender may lower the interest rate on your credit card balance when you participate in a debt management plan.

Debt management plans typically last three to five years.

You can transfer high-interest rate credit card balances to a single card with a lower APR and save money on monthly finance charges as you pay down your debt.

For consumers with good credit, there are several credit card balance transfer, and low-interest rate available.

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