Credit card debt consolidation loan

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	Typical APR Variable	Max Int Free
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	14.9%	56 days
	14.9%	56 days
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If you are thinking of using a loan to consolidate credit card debt, you need to think carefully about how you have built your credit card debt up and how you are likely to spend money in the future. It is a fact that many people who take out a credit card debt consolidation loan end up further in debt in a few short years rather than getting out of debt.

Credit cards have high interest rates - often between three and four times the Bank of Englands base rate while a credit card debt loan might charge just a couple of percentage points above the base rate.

However, you are likely to be paying your credit card debt consolidation loan off over a long period and while the monthly interest charge may be low, you could end up paying a larger amount of interest than if you just concentrated on paying down the credit card debt off as fast as you can.

The question is, how disciplined can you be? Theres no point in taking out a credit card debt consolidation loan and clearing your credit card debt only to then spend more money on your credit cards.

Using credit cards is a convenient way of paying for your purchases but you must remember that you are using somebody elses money and theyll want it back with interest. If you are struggling with credit card debt then a debt consolidation loan could make sense but you need to consider carefully how you use your credit cards in the future.

Read our debt consolitation guide for more information on debt managment.

Last Updated: May 2007 © Moneyextra.com

Our senior editor Robin Amlôt recommends you should consider taking independent financial advice before acting on any article. Please contact us for help with your individual circumstances if any assistance is required.