Suggestions for Dealing with Credit Card Debt
Debt is a funny thing. On one hand, it is kind of unavoidable. If you want to drive a decent car or purchase your own home, you are going to have to go into debt.
On the other hand, a credit card debt can quickly snowball out of control and before you know it, you are looking at a mountain of bills that you are never going to be able to pay off.
The biggest problem most people have is their credit card debt. It is very difficult to keep track of how much you are really spending when all you have to do is swipe a piece of plastic through a machine.
In addition to the actual purchases that you made, the credit card company always adds interest which continues to grow until the entire card has been paid off.
It does not take very long before the credit card bill becomes something that you dread opening.The worst thing you can do is ignore the bill.
Making the minimum monthly payment will not get it paid off, but at least it will buy you some time with the company until you can come up with a better way of paying it off.
Here are some suggestions for you:
Contact your credit card provider
One of the things that some financial experts recommend is talking to the credit card company and seeing if they will agree to some type of debt settlement proposal.
Ideally, the company would like to get all of the money, but they are usually pretty open to the idea of reducing the debt so that you at least pay off the principle. Once the deal has been made, you usually have a limited amount of time to pay off the debt.
If you have not paid the agreed-upon settlement price but the agreed upon date, the settlement will be off and you will be back to where you started. There are many instances where a debt settlement was used to reduce a person’s credit card debt by as much as 60%.
Consolidate your debt
Another option that more and more people are starting to turn to is called debt consolidation. This is something that requires the involvement of a third party, who should be a legitimate debt consolidation company or possibly a lawyer.
The company will contact the people who you owe money to and try to work on getting all of the loans lumped together so that you only have to worry about one large payment instead of several smaller ones.
Having only one payment to deal with makes it easier for some people to manage their debt and their personal finances. Another advantage of debt consolidation is that while the companies are working out an agreement, many of credit card companies will also reduce the amount of money that is owed to them.
File for bankruptcy
A third option is to declare bankruptcy. This particular option should only be considered if you have no other options.
Declaring bankruptcy will have a permanent impact on your quality of life and your ability to get approved for loans. Just because you have declared bankruptcy does not mean that your debts will go away, most of them will still have to be paid.