Will a Bank Consolidate Credit Cards?

When you consolidate credit cards, you take out a loan to pay off the current balances you owe to each credit card. By doing this, you transfer multiple debts to the lender who gave you the consolidation loan. Many consumers use bank loans of one kind or another to consolidate credit cards, though you should consider the loan terms carefully before agreeing to take on more debt.

Bank Loans

To consolidate your credit cards, you need to find a lender willing to give you a loan. Whether the lender is a bank, another credit card company or anyone else doesn't matter significantly. All that matters is that you find the lender willing to give you the money and use that money to pay off your credit card balances. Banks typically give credit card consolidation loans in three main ways: a home equity loan, a credit card with a balance transfer program or a personal loan.

Bank Loan Requirements

Each bank sets its own loan requirements, and any time you want to get a loan from your bank you must meet these standards. Banks typically use the same information to determine whether you're a good candidate for a loan: your credit score, debt-to-income ratio and income. If you qualify, inspect the bank's offer. You have to pay back your debt consolidation loan like any other loan, and if your bank is unwilling to give you competitive loan terms, consider looking elsewhere.

Credit Unions

Like banks, credit unions also offer a range of credit card debt consolidation loan options, such as credit cards and home equity loans, and often at lower rates than a bank, according to MSN Money. Unlike banks, a credit union requires you to be a member to apply for a loan, but membership is usually free. Credit unions sometimes have less strenuous loan requirements, making it easier to get a loan.

Other Considerations

If you're considering a credit card debt consolidation because you're facing financial difficulties and believe consolidation will solve your problems, you should consider other options as well. Consolidation does not automatically solve your financial hardships, and it can lead to more difficulty if you don't learn to manage your debt. Talk to a credit counselor if you need help getting you debt under control.