Credit card consolidation offers many Americans an escape from a mountain of high APR maxed out credit cards. The guiding principle for consolidation is to gather up all those individual credit card balances, or at least some portion thereof, into one larger obligation. Ideally this obligation, to be a good credit card consolidation offer, will have lower APR, and a longer repayment term. Although, this is not always the case. Even if the APR was nominally higher, your credit card payments could be stretched out over time to reduce the monthly minimum if you’re trying to stop collection calls.

There are various lenders offering credit card consolidation. Four major types of credit card consolidation strategies are offered by lenders specializing in personal bank loans, home equity loans, credit card consolidation through new account opening, and unsecured loan solicitations. Each one of these lenders will employee different terms to help woo you to refinancing your credit card debt through them. For example, home equity loans work to take out money based on the value of your home minus any outstanding debts.

If you own a $200,000 home and only owe $190,000, you have $10,000 of equity that could be taken out in a home-equity consolidation loan. This consolidation loan offers exceptionally favorable interest rates, amiable repayment terms, and is well suited for credit card consolidation. The caveat – your home goes up as collateral. If you default on a home equity loan for credit card consolidation, a lienaon your home, and potentially even the loss of your home-stead are possibilities.

Another credit card consolidator is your local banks. They also offer good loan APRs and specialize in a vast array of repayment terms. Their decision to loan you money for a credit card consolidation is one of the hardest forms of consolidating credit to obtain, as banks are one of the most cautious industries in the market for risk assessment.

Credit card companies would love to consolidate your outstanding debt. With over half of adult Americans owning at least one credit card, they would love to get you to shimmy all (or a large portion) of your debt to opening a new credit card account with them. They often offer 0% balance transfers with new accounts, and periodically offer low (below 7%) short term APRs for refiancing your credit card debt.

They can offer such low introductory rates for two reasons: first and foremost, they are hoping you mess up and they can sack you with all sorts of fees and a higher Annual Percentage Rate. Secondly, they need more accounts. With practically everyone already having a credit card, gaining new account holders is an extremely competitive business, and even if you don’t screw up, the odds of you maintaining an open account after repaying any outstanding consolidated credit card debt are in their favor.

Unsecured loans are a fourth option for credit card debt consolidation. They are arguably the poorest choice as they tend to prey on vulnerable individuals. Unsecured Loan Agencies (ULAs) perform extensive risk assessment to establish a breaking-point offer. This offer is saddled with typically an exceedingly high APR, often 14.99% - 27.99%. The repayment terms can in some instances prohibit pre-payment to maximize their collected interest. ULAs also will loan you more money than you could reasonably be expected to pay back. Additionally, ULAs have intimate relationships with credit card and debt collectors, which can keep your phone ringing from sunrise to sunset.

In making a decision to consolidate credit card debt, make a serious endeavor to read all the fine print accompanying every offer and shop around. Virtually everyone these days wants part of your credit card debt, and they’ll extend a sugar coated hand with a promise of salvation to you. Used correctly and wisely, credit card consolidation can be a valuable tool to get out of debt.