That article is about Free Credit Card Debt Consolidation. Free credit card debt consolidation is available for debtors who need assistance with their debt programs, but do not wish to invest money into it. There are many non-profit organizations that provide, free credit card debt consolidation, as a part of their community service programs. There are many free programs supported by credit card companies, to help regain money from their debtors.
Free debt consolidation helps debtors, keep their credit rating and future credit option, in good condition without spending, to get a debt consolidation program. Credit card companies use credit ratings to determine the credibility of an individual, before approving a credit card.
Credit bureaus rate the credit score on the basis of outstanding debts, period of debt, types of credit used and kinds of accounts that are operated. Late payments or non-payments of past debts have a negative impact on the person’s credit history and could cause him or her to be, not eligible for a loan or credit card in the future.
A credit card holder has the option to, pay the full amount due or carry over the balance to the next month, known as revolving credit. Credit cardholders, who have accumulated a lot of debt, often choose to make the minimum required payment. Further, if due to several due payments, the customer misses the payment for any month, the interest charged, for the next payment is even higher.
The credit card companies even have the right to increase the applicable interest rates, in case the customer is late in minimum payment or balance payment. The debt incurred does not reduce even with continuous payments, as the amount is applied usually to the interests and not to the principal amount. This becomes a vicious cycle for the credit cardholder, and takes a lot of effort, spending discipline and time to catch up with the debt.
For those who don’t want to add to the chaos by being inundated with a flow of new credit card offers, it’s necessary to put a stop to receiving unsolicited pre-approved applications, as they not only add to the junk mail received by a person but may also become a cause for identity theft. If such a pre-approved application that a person has discarded, is found by someone, he or she may impersonate that person and receive a credit meant for that person. This leads to a lot of problems for the person, whose identity has been stolen such as ruined credit rating and fraudulent charges on the account.
Many cardholders find themselves with poor credit rating after accumulating a lot of debts. An adverse credit history has a lot of drawbacks, but usually, they are not irreversible. It takes a person some years to accumulate bad credit scores and will take at least the same amount of time to get out of it.
Besides negotiating for the payments, it is also important to negotiate for the type of report the creditors will send to the credit bureaus as this has long term effects on your financial status.