How To Get Rid Of Credit Card Debt – A 6-Step Debt Relief Plan No ratings yet.

When you are stuck deep in financial crisis, particularly when you owe a lot of money to your Credit Card Company or creditors, you will certainly look for a debt relief plan that can help you out.

Following Queries will be answered in this post:

How Do I Get Rid of My Credit Card Debt?
How Do I Pay Off $7,500 in Credit Card Debt?
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The Fastest Way to Pay Off $20,000 in Credit Card Debt
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How to Get Rid of Credit Card Debt Fast

The reason why you are facing this problem with debt may not even be your mistake. There can be various other reasons responsible for it such as losing your job and failing to get a new one. Maybe there was a medical emergency that led to increased medical bills or you have gone through a costly divorce that annihilated all your finances.

Of course, maybe you are only responsible for your debt. But despite the reason of being in the debt, you are aware of one thing and that is you would want to get out of credit card debt as soon as possible.

First thing first, understand one thing that you are not going to get out of the claws of debt overnight. It took some time to get deep into the debt and it will surely take some time to come out. But, things aren’t bad as it seems as you can follow a 6-step plan for debt relief for getting rid of debt fast and forever. So, without any further ado, let us get familiar with this plan that you need to follow religiously –

Get Rid Of Credit Card Debt

Step 1:Be prepared

You need to pull up your socks to get yourself out of the debt. You can do this by assembling all your recent credit card statements along with the loan statements. Don’t overlook, by any chance, the significance of having your credit report from the three key credit bureaus – Equifax, TransUnion, and Experian.

Well, you can go the easy way by exploring the website www.annualcredit.com. Here, you will have ample time to go through the errors (if any) that could be influencing your credit score. It is imperative that you are well-aware of your credit score and it is very easy to do it now. If you find out that your credit score is low, then you don’t need to go berserk, as it is because of your debt problems.

Step 2:Make a list

Remember your old school days when you used to memorize everything by writing; well you have to follow that same thing here also because when you write down something, you tend to remember it for a longer period and moreover you have a written record as well. You need to list down all your debts and to be precise make sure you have included the name of your creditor, minimum monthly payment, your balance, and the interest rates.

Your list should also include the monthly amount you need to pay for each of your debt in three years. In the case of credit cards, you can have a look on your monthly statements. If you have loans, the details might be there on their statements. If you are not able to find it, make sure you have called your loan provider to have this information. Avoid listing your loans on your credit report like family loans or medical bills.

Step 3:Cut down the interest rates

In case, you are paying high-interest rates on your debt then you cannot expect your debt to come down anytime soon. Alas, this will also make things difficult for you to get relief from debt. It is only possible by calling your creditors or your credit card company to lower down your interest rates. But, you need to have a reason why your interest rates should be lowered.

If you are having student loan debt, then you need to explore the website www.studentloans.gov and go through the student loan consolidationand availability of income-based repayment plans. You may be able to find a Pay As You Earn plan (PAYE) or Federal Direct Consolidation loan. You can go for a debt consolidation loan or you can also opt for balance transfer in order to pay off your credit card debt.

Step 4:Calculate your total payoff number

This is where you will have to total your three-year payoff amount of your credit cards. Make sure you have also added the monthly payments of any other debt you might be having. Make a grand total and you will have your total monthly payment.

Step 5:Develop a strategy

A strategy can be of great help in your quest to pay off your debts. Will you be in a position to afford the total monthly payment calculated Step 3 until you have paid off all your debts? If not, then you should contact a credit counseling agency or probably a bankruptcy attorney as to decide which debt you should pay off in the first place. You also have the option of using either the avalanche method where you will first pay off the debt having a high-interest rate or the snowball method, where you first pay off the debt having the lowest balance. Consider this as your ‘target debt’.

After that, set up an auto pay in order to make the minimum monthly payments for all your debts other than the target debt. Make sure you have made the maximum payment on it until you have finally paid it off. You can also make a selection for a second target debt and start making extra payments on it until you have paid off that as well. Then, follow as the famous saying goes – “Rinse and repeat”.

Step 6:Audit your credit score and make necessary changes

Once you have a plan in place, make sure you are extra cautious to track the things just to ensure that you are going in the right direction of making the progress and make the required changes. Monitoring your credit score is imperative just to see if there are improvements. You should be happy that you will get to see improvements over time. When you see it improving, you may want to reconsider having a debt consolidation loan or you can also opt for balance transfer just to save money on your pending debts.

Final words

Well, the main mantra here is to stick to this plan to get rid of debt and make your movements accordingly until you have paid off all your debts. Once you are done with your debts, make sure you refer to the list you made in Step 2 and cross-out all the debts you have paid.

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10 Invaluable Credit Card Debt Consolidation Tips To Help You Get Out Of Debt No ratings yet.

If you really want to see yourself out of debt, then Debt Consolidation is one of the effective ways to do it. There is no set number of people who opt for debt consolidation each year but the people prefer to use this method instead of filing a bankruptcy. More than 1,400,009 people have already filed for some type of bankruptcy this year.

Should you go ahead with the option of credit card consolidation?

Yes, If you owe $4,000 or more in credit card debt, then you should use debt consolidation. In fact, it is an ideal choice for all those people who are facing a huge amount of credit card debt and they are unable to pay it back by making monthly payments.

consolidate-credit-card-debt-tips

A simple test

Yes, you can actually test whether you are eligible for credit card debt consolidation or not. First gather all your statements of your credit cards; your next step is to add up the interest on these credit cards, and you need to compare it with the minimum monthly payments needed. If the monthly payments are pretty much the same as your interest charges then you can go ahead with the option of debt consolidation. If you are still making minimum monthly payments, you will spend your lifetime getting out of your credit card debt.

Important Credit Card Consolidation Tips

Now, let us discuss important tips related to consolidating Credit Card Debt that you should know –

  • It is not mandatory that all scenarios are created equal

Before you go ahead and think that debt consolidation is the right choice for you, is important to answer some questions –

How long is the introductory low-APR window?

-If you have a longer APR duration, you can actually get more time to make the payment for your debts before the rate goes up.

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How much debt you have?

-You can get the actual owed amount, to the creditors, by adding all your credit card statements.

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How much you can actually pay towards the credit card on monthly basis?

-The main aim is to pay off your debt as quickly as possible. Therefore, you can tally up how much you can actually allocate towards making monthly payments.

Keeping the above-discussed three elements in mind, find out what is the actual amount you can save on interest during 0% APR duration as compared to the current rates. Now, you should calculate as how much you will actually pay in interest at the standard purchase rate. At last, you have to compare these numbers with what you would be paying in interest at your existing rates.

  • Get to know about 0% APR application

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Make sure you are aware of the fact that the initial APR of 0% might only apply to balance transfers exclusively. As a result, there are chances that new purchases might be charged as standard APR – which can be quite high. Your cardholder agreement will be having the annual percentage rate for the purchases and whether there will be application for intro rate or not. Make sure you create a budget and stick to it. This will really come handy in getting the most out of debt relief program and also help you pay off your balances quickly.

  • Consolidation can be done with the help of a personal loan

personal loan can be defined as a loan that can be taken from a credit union, a bank or from a lender under your name. As there is a need to put up collateral for a secured loan, there is no such requirement for a personal loan. If you are interested in consolidating your debt, then you can take out a personal loan for that. All you need is to add up the owed amount and apply for a loan in that amount. If the loan gets approved, you can use the proceeds in order to make the payment for your debts.

  • Consolidation can also be done with the help of credit card balance transfers

Credit card balance transfers actually offer an alternative for the personal loans in regards to debt consolidation. There is a need to transfer all your debts from multiple credit cards to one single card. The chances are high for you to receive a special introductory balance rate, it can be 0% for 5 months, but you will have to make the payment for the balance transfer fee.

  • Consolidation into a mortgage loan can also be done

If you own your home and have equity in your home, you can take a second mortgage and you can use the proceeds to make the payment for your debts. This helps in consolidating all your debts in one single mortgage loan. The best part is that it helps in lowering down your interest rates as compared to your credit card debt or a personal loan.

  • Using debt consolidation agencies to consolidate

The fact cannot be denied that you can easily find numerous agencies or companies that offer debt consolidation services, but having said that it is not that difficult to do it on your own as well. All you require is to apply for a personal loan or a loan that suits you and then use the money that you might get to pay off your debts.

  • Credit consolidation reduces your monthly payments

If you have a debt with high interest or a debt that needs to paid within a specific time period, consolidating to a lower interest rate can really prove handy in lowering the amount you have to pay on a monthly basis. Also, if you have multiple debts and you have consolidated all of them in one single loan, this too can also help in bringing down the minimum amount you need to pay each month.

  • Debt consolidation can also bring down your interest rate

Most of the people choose to consolidate higher interest rate into a loan that offers lower interest rate. Not only this helps in bringing down the monthly payment but it also means you will be paying less for the privilege of borrowing money and ultimately your debt will have lower cost to you.

  • Debt consolidation can help in making changes to your debt structure

If you choose to consolidate your unsecured debt like credit card debt into your mortgage, this will change the structure of your debt from unsecured loan to secured loan. This will mean that you have more chances of having penalties for your nonpayment. While your credit company is not authorized to take your home if you don’t pay but the mortgage company has the authority.

  • Debt consolidation can also simplify debt repayment

If each month you are sending bills to different creditors, it can become quite arduous to keep a track of all the bills. Owing to this, you may miss out your due dates and incur late charges. Let us say, if you are dealing with only one creditor, it is much easier to keep a track of the bills and it also reduces the chances of late payments.

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27 Biggest Credit Card Debt Myths Busted – INFOGRAPHIC No ratings yet.

Make sure you’re getting these right.

Credit cards are one of those things that people think they know, but don’t actually understand. And if you’ve got a blind spot, you might be making some expensive mistakes.  A surprising number of Americans struggle with basic credit card concepts . On issues ranging from credit scores to revolving debt to rewards cards, many borrowers displayed an incomplete and often inaccurate picture of how credit works. Credit cards, like any financial product, seem to create a certain amount of anxiety for people. There are myths and rumors running rampant about how to spend on a card, when to pay it off and whether or not to even have one. Unfortunately, some of these credit card myths may be causing your wallet – and your credit score – more harm than good information .

credit card myths

Getting your first credit card can be an important part of establishing your credit history. If you pay off your balance in full every month and make on-time payments, a credit card may be a useful tool. However, there’s a lot of misinformation about credit cards that could cause you to wreck your credit if you’re not careful.

Few important points has been discussed here. Closing a credit account can harm your score in two ways, however. You’re reducing the amount of credit available to you, and thus — assuming you don’t change your spending — increasing the share of available credit you use. (This is your so-called credit utilization ratio, which influences 30% of your FICO score.) At the same time, you are decreasing the average age of your accounts; the length of your credit history determines 15% of your score. Perhaps one reason people are inclined to close old cards is that more than 90% of respondents think the number of cards you own impacts your credit score.

A majority of borrowers (54%) are under the impression that carrying a monthly debt burden improves their credit score.

This is just plain wrong. Carrying a balance will simply cost you money. Pay your cards off each month.

About 27% of the survey’s respondents said that it never makes sense to pay an annual fee for a credit card, while 14% said it only makes sense if the fee is waived for a year — and another quarter said they just weren’t sure about them.

Also Read: 13 Carcinogenic Debt Consolidation Myths You Ought To Know In 2017

What’s more accurate, however, is that you should never pay an annual fee without making sure the rewards you would get from the card outweigh the yearly cost. And many spenders are leaving hundreds, if not thousands, of dollars on the table.

There is a common misconception that carrying a credit card will ultimately lead to damaging credit card debt. Sure, some people don’t understand how to handle credit cards – or have personality types (looking at you present hedonists), that result in maxing out any credit limit.

However, for the responsible individual, a credit card offers one of the easiest ways to establish and build credit history. Prepaid cards and debit cards do nothing to help establish credit history.

Instead of just listening to scare tactics, consider your time perspective (which you can test here), responsibility levels and history with debt. If you’re the kind of person who always handed homework in on time, never misses an appointment and understands how to budget – well you can probably handle a credit card.

Only have one credit card

This myth is linked with the notion that people can’t have a credit card in their wallets without incurring debt. This is valid for some, but not everyone.

If you feel you can’t handle paying off credit card bills on multiple credit cards because you’ll either a) forget b) rack up too many purchases or c) get overwhelmed, then stick with one.

For those who are organized, responsible and maybe like to take advantage of cash back rewards – then go ahead and get more than one credit card.

Don’t accept a credit limit increase

Get an offer to increase your credit limit? Yes, your lender is trying to lure you into a trap. But get this – you can use their trickery to your advantage.

To understand why, let’s recap how your FICO credit score works:

  • Payment history (35%)
  • Amounts owed (30%)
  • Length of credit history (15%)
  • New credit (10%)
  • Types of credit used (10%)

“Amounts owed”, which accounts for 30% of your score, is also referred to as utilization: the amount of your credit limit you use. The more debt you have, the lower your score. The ideal utilization is 30% or less of your overall credit limit.

If one spouse has excellent credit, the other doesn’t need to worry since they can just use the other one’s score to apply for loans.

While there is no such thing as a credit score for couples, one spouse’s credit could affect the couple’s ability to get credit. For instance, in cases where one person could not qualify alone, credit reports and scores for both people are considered when couples apply for joint accounts or for a mortgage loan. They might be faced with higher interest rates, fees or even being denied on these joint accounts because one person has a poor credit history.

Good credit is tied to how much money a consumer has in the bank.

How much money consumers have in the bank doesn’t affect credit scores. A bank account does, however, affect credit scores if a consumer bounces checks and does not pay the money back. If the balance owed to the bank gets turned over to a collection agency, then that information will show up on a credit report.

Credit card debt is something to be ashamed of.

Nearly half of all Americans have credit card debt.  Are half of all Americans ashamed? Of course not (Well maybe… if we’re talking about the Leafs.)  Fact is, shame isn’t a useful emotion. Proud determination to get rid of that debt is.

Go for proud. It’s totally doable.

You can also Download PDF version of the above infographic.

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Top 5 Debt Management Questions Answered No ratings yet.

There are certain questions that you are too ashamed to ask anyone whether it’s your family members or your friends. If you are going through financial hardships, you certainly don’t want anybody to know. Often you choose to shy away from asking questions related to debt management and prefer to turn a blind eye towards the situation.

Either you are embarrassed that you have gotten yourself in this situation or you are embarrassed to seek any assistance as the situation has gotten out of your hands. This can never be a good idea. So, let us discuss five common Debt Management Questions people are commonly embarrassed to ask –

Debt Management Questions

What is the right time to declare bankruptcy?

There is nobody on this mother earth who is having the liking for the word ‘bankruptcy’. Some of the people have even gone to the extent of construing the word as failure. But, bankruptcy is not that bad at all. There are some of the wealthy and influential people who have declared bankruptcy but they all are leading a normal life. In fact, it offers you a chance to restructure your debts and working with your creditors to pay off the owed amount while looking for a protection that won’t leave you penniless.

Now, here comes the burning question i.e. when to declare bankruptcy? Well, this depends on case to case. But, if you are in a position of only making minimum payments on your credit cards and you are using them to pay minimums on your other credit cards, then this is a big warning sign. If you are not in a position to pay the bills, you don’t have any savings left, and you are about to get evicted, then you are in deep water.

However, you can use a simple test to add up all your assets and compare them to all your debts. If your debts overpower your assets and the creditors are calling you time and again, then this is the right time to declare bankruptcy.

How Do I Declare Bankruptcy?

If you have thought hard and you are convinced that bankruptcy is right for you, then the following step is to go and do it, no looking back. But, be informed it can be a daunting prospect. Your first step should be to be familiar as what type of bankruptcy you should declare? You have heard about Chapter 11, but it is a complex solution and it is mainly for the businesses. Instead, you should think about filing a Chapter 7 or Chapter 13 bankruptcy.

Talking about Chapter 7 bankruptcy, also termed as straight bankruptcy, it is not that arduous. As per this plan, your current assets get liquidated in order to pay a maximum amount towards the owed debt. The remaining debt is then bargained, some of your debt may be forgiven and the remaining debt will be added to the repayment plan that you can easily afford. One of the biggest disadvantages of this Chapter is that you may end up losing all that you actually own, including your car, home, and other valued possessions.

As for Chapter 13, if you own a property then it can be a boon for you. It is commonly termed as ‘reorganization bankruptcy’ and you may need to choose this anyway if you are having an annual income that is too high to get qualified for Chapter 7. But, no matter what option you go for, both the options are piled with various rules and regulations.

Once you have made your mind about a preferable bankruptcy, the process begins by filing a petition that is of two-page at your district bankruptcy court, along with other required forms, and a fee of around $300. The best thing you can do is to find a good and experienced bankruptcy attorney as you don’t want to fight this battle on your own.

How to deal with the credit card debt?

Unfortunately, credit card debt can make you feel helpless and debilitated. Sadly, people tend to go for more and more credit cards in order to cover up the costs and before they actually realize they end up burying themselves in making minimum monthly payments that they cannot even make. But, if you are stuck deep into the debt, there are certain options for you.

Firstly, are you aware of any method through which you can transfer your debt to loans or your other credit cards having low rates? As compared to a credit card, an HELOC has a lower rate and the repayment terms are favorable as well. You will find credit cards offering 0% interest on balance transfers and with a small fee or at times no fee at all, so you need to put your shopping skills to test here.

Are you able to cut costs somewhere else to have additional money for making credit card payments? Do you have a gym membership? Do you go out for dinner often? Do you have magazine subscriptions? Make sure you have looked for the ways to cut everywhere and use the amount to pay off your debt.

Finally, you can use the ‘Snowball Method’. As per this method, use the maximum amount of money as you can to pay off the credit card with the smallest balance, whilst making minimum payments on other credit cards. Once the balance reaches 0, take all the payment and use it for the next credit card. This can give you a sense of accomplishment and the payments keep on rising on each card, try snowballing to have enough payment by the time you reach to your last card.

Is there any way to improve the credit score?

If you have a low credit score, it can be embarrassing and proves costly as well. The credit score plays an imperative role in the kind of the financial deals you will get. You, obviously, want to have impressive percentage rates on both your credit cards and loans, so it is important you have stayed away from being turned down for any kind of credit, it is important you have addressed the issue.

You might be aware of the fact that you won’t be able to fix it overnight. Be prepared, as it will take a significant amount of time to improve your credit score. But certainly, there are steps that help you make the improvements immediately.

Start off by having a copy of credit report and you can have it from www.annualcreditreport.com and you don’t need to pay anything for that. Make sure you have not committed any mistakes. It is quite common to commit a mistake but you can start off by correcting those mistakes. Make sure you have addressed any late payment or delinquencies and your credit score will also increase as and when they are removed.

Next step is to have a glance at your credit card balances. Are you one of those individuals who have small amounts spread over varied credit cards? If your reply is in affirmation, you should choose to consolidate those debts onto few cards and you should allow those cards only to go forward. However, closing out other cards is not recommended. Make sure you leave them open as it can hurt your score as well. Leaving them open will prove your credit utilization ratio, which measures how much credit you have available free to use.

For the future, you will have to ensure you pay all your bills on time. Technology is surely a great thing and you should make the most of it. You can also create a calendar either on your phone or your laptop that will show you when your bills are due. You can also use auto-pay that also helps in avoiding any instance of late fees.

What is the difference between Good and Bad Debt?

You might be wondering as for how debt can be termed good? Well, there is a noteworthy difference and if you know the actual definition, it can surely have a great impact on what you want to spend on and the manner in which you spend it.

Talking about good debt, it is something that helps in creating value over time. It has been seen that most of the people prefer buying a home good debt, as the investments grow in value, and eventually will lead to more money at the end of the day. Other examples comprise of student loans, which can be termed as an investment in yourself, and business loans which should lead to greater revenue. Certainly, these examples are marred by different things such as the collapse of the real estate, lack of well-paying jobs after graduation, but as a general rule, they are still considered as good debt.

When we talk about bad debt, it is something that helps in creating no value over time. It’s actually the money that is being spent on various disposable items, high-interest rates, and anything else that add on to the spending without eventual fiscal profit. A new car loan can be considered as bad debt as the car decreases in value. Even if you are dining out regularly that is also considered as bad debt if you continue ringing on the credit card and only pay off the interest each month.

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11 Widespread Credit Counseling Myths You Need To Chuck Out Right Away No ratings yet.

If you are having a tough time keeping up with your credit card payments, credit counseling is one of the solutions you might be considering. However, you are not able to trust the method as you believe in various myths floating regarding the credit counseling. Let us discuss the myths that surround credit counseling and what is the actual truth behind these myths –

Credit Counseling Myths

Finding legitimate help can be difficult

There is no doubt you need to be extra cautious when it comes to financial matters, but to let confusion and doubts be a barrier to getting help cannot be termed as a smart move. In order to find the right help, you should look for an agency associated with a membership organization such as BBB (Better Business Bureau), NFCC (National Foundation for Credit Counseling) and attorney general office, looking for unresolved complaints against any agency you might be thinking of considering.

Credit counseling is an expensive affair

If you are taking counseling services from an NFCC member agency, then the best part is that the services are either free or have nominal charges. One of the quality standards of NFCC member is that they are not authorized to deny the services on the basis of inability to pay. Therefore, if you are indeed facing hardship, the fee may be waived off.

Credit counseling will affect the credit score and credit report

The best thing about NFCC member agencies is that they don’t report to the three credit bureaus. Many credit scores of the clients have improved post credit counseling or by using a DMP (Debt Management Plan), as you make constant payments that help the debt to decrease.

Opting for a debt management plan, you don’t have to pay the bills

In reality, the key purpose of a debt management plan is to assist you in handling your debt efficiently and help you to pay off your debt easily by arranging a low-interest or a lower monthly payment. The main aim of DMP is to learn how to manage money responsibly. In other words, it can be said that you still have to make the payment for what you actually owe.

A credit counselor will mend your credit score and wipe all the negative marks from your credit report

A credit counselor doesn’t hold the authority of cleaning up your credit report. In the event where the negative marks are correct and legit, they will continue to show up on your credit report for up to seven years. And bankruptcy will continue to show up on your report for ten years.

Credit Counseling cannot stop legal action

This is surely a myth. In most of the cases, NFCC member agencies work together with the agencies to stop any legal action and also finding a solution that ends up satisfying each party.

You will only get financial advice

Since there is counseling word mentioned in the title, most of the people assume the literal meaning of it and think they will only receive the advice. Different credit counseling agencies will offer different services as per judging your situation. Most of these agencies will offer written plans along with different steps so that they are able to carve out a concrete plan of reaching out to the creditors and negotiating the fees. These agencies also provide financial education along with offering solutions.

Related: 13 Carcinogenic Debt Consolidation Myths You Ought To Know In 2017

Debt Management Programs and Debt Counseling is same

Most of the people think that DMP (Debt Management Program) and Debt Counseling is same but in actuality, there is a difference between them. Credit Counseling usually involves helping you to create a budget and sticking to that budget. Most of the debt counseling agencies organize seminars on money management along with having racks of free brochures on debt and money management.

In comparison, a DMP (Debt Management Program) is where the agency will play the role of a policeman who will take money from you in the form of monthly payments and further will distribute to your creditors until your accounts come down to zero.

Most of the credit counseling agencies will also make their best efforts to have a word with your lenders. This negotiation is done to have lower interest rates or waiving off the late fees so that you can have more monthly payment.

Credit counseling agencies can negotiate lower DMP

This is another common myth. There are chances that the credit counseling agencies could negotiate lower payments only if there was negotiation involved, but there isn’t. If you come across a counselor saying he/she can negotiate lower DMP payments, then in reality you are talking to a debt settlement company. This is where you need to transfer a fixed amount into an escrow-type account on a monthly basis.

Once you have a significant amount of money in your account for settling one of your debts, the settlement firm will get in touch with you asking you to release enough money to cover it. This goes on until the repayment has been made to all your unsecured debts.

Related: 11 Hidden Secrets About Dealing With Debt Collectors

A formal program is required to get out of debt

You will find various lenders who will get you registered in a reduced-interest program if you meet them in person. The negative thing about this is all those phone calls you have to make and that you will have to project yourself like you are stuck in some financial emergency.

But, no matter what happens you don’t need a formal program for this. You can easily handle this on your own. The same is also true if you aim to consolidate your debts via debt consolidation loan. If you have equity in your home, then you can either have a home equity loan or a homeowner equity line of credit yourself without taking the assistance of any third party.

Related: What Is A Balance Transfer And How Does It Works?

Never opt for bankruptcy

Honest and genuine credit counselors will always advise filing for bankruptcy if you are in a financial emergency. While bankruptcy will have a negative effect on both your credit report and credit score, it is certainly one of the effective ways of reducing the burden of unsecured debts in all those extreme situations. Let us assume you have yearly earnings of $20, 000 and you also have an accruing debt of $50, 000. This is the exact case where bankruptcy can really come handy.

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Credit Card Debt Settlement Process No ratings yet.

Being in debt isn’t great. Being unable to pay your debt is even worse. While no one likes dealing with debt collectors, doing so can help make your debt more manageable—and maybe even reduce how much you owe through the process of debt settlement.

Debt Settlement

Debt settlement is a process of negotiating with one or more creditors to reduce the balances owed by debtors. Also known as debt resolution, the process can benefit all parties, although the scales are tipped on the side of the person who owes money.

debt-settlement-process

When settling makes sense?

Debt settlement is not for everyone, but it can be a good solution if your only other option is Chapter 13 bankruptcy.

“I recommend that anyone thinking about debt settlement talk to a bankruptcy attorney to see what their options are, especially if they owe more than $10,000,”. “If you do qualify under the new rules to do a Chapter 7 bankruptcy, that could make more sense.”

Changes in the bankruptcy law in 2005 made it difficult for many people to file for Chapter 7 bankruptcy, which liquidates debts. If you have regular income and there is some leftover after you pay basic expenses, then you must go to Chapter 13 bankruptcy, which requires that you pay back some or all of what you owe over five years under a very rigid payment structure.

One way to resolve your credit card debt or other debt is to enlist the help of a debt settlement company. Debt resolution companies often are experienced at negotiating with creditors and may have relationships with major creditors, specifically credit card companies.

The first step in the debt settlement process is for a consumer to reach out to a reputable company that can help. These debt arbitration firms are staffed by credit counselors, people who are accredited in analyzing personal finances. They also have a keen understanding of the current marketplace, including how and why creditors will negotiate debt settlement.


People also ask

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Credit Card Interest Rate Calculator: Paying interest on your credit card balance No ratings yet.

How Much Interest Will I Pay?

We explain how to calculate interest rates on your current credit card to make sure you aren’t paying over the odds. If you’re new to credit cards you can read up on how credit cards work to get to grips with the basics.

how-is-credit-card-interest-calculated

What is the APR?

So your bank tells you that your credit card has a 15% APR. What does that actually mean? How does you calculate your credit card interest rate, and how does that translate into how much you actually pay?
A credit card’s interest rate is the price you pay for borrowing money. For credit cards, the interest rates are typically stated as a yearly rate, called the annual percentage rate (APR). On most cards, you can avoid paying interest on purchases if you pay your balance in full each month. Other than Credit Card Interest Rate Calculator, Calculating your APR on your credit cards takes only a few minutes if you know some key factors and a little algebra.

How do you figure out APR on credit cards?

To do so, divide your APR by 365, the number of days in a year. At the end of each day, the card issuer will multiply your current balance by the daily rate to come up with the daily interest charge. That charge is then added to your balance the next day, a process called compounding. – source

How is the minimum payment calculated?

In many cases, a credit card company will charge a percentage of the balance on the card as the minimum monthly payment. If you have a $1,000 balance and a 2% minimum, you will owe at least $20 for the month. Part of that money will go toward interest, and a tiny portion of it will go towards your principle. – source

Credit card APR tells you what interest rate you pay, but it doesn’t include the effects of compounding – so you almost always pay more than the quoted APR. If you only make small (or minimum) payments on your credit card, you’ll start paying interest not only on the money you borrowed, but you’ll also pay interest on the interest that was previously charged to you. The APR on mortgage loans, however, is different from the simple interest rate because of additional charges or fees to you for securing your loan.

To Avoid Paying Credit Card Interest – Follow these 5 simple steps

1. Pay your balance on time and in full every month, and you’ll never have to pay or calculate credit card interest again!

2. Set a reminder to pay your bill early

3. Only charge what you can afford to pay off each month.

4. Take advantage of a 0% APR balance transfer offer

5. Use your card only in emergencies

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Credit Card Debt Consolidation 5/5 (1)

Banking always involves the dip of a trick! Whenever it comes to anything monetary, one has to be very tactful and strategic. Borrowing money, comes out to be important and so does the management of the debt. Before we read further about best ways to consolidate credit card bills, you should know few basics.

What is Debt?

Debt is anything or a sum of money that we owe to a lender, i.e. the Bank. It varies from person to person and various Banks have different rates of interests that they levy on these Debts.

How do I use my Credit card?

A credit card is an easy method for payment to the merchant, where the bank issues the payment to the consignee, issuing a deadline for the holder to pay off the borrowed amount, i.e. Debt.

What is Consolidation of Debt?

In case, the customer gets various credit cards issued, he ends up owing money to various banks at various different rates of interest. To get rid of such an inconvenient process, consolidation of credit card bills enables you to consult and borrow one loan from a Bank to payoff all the debts underlying various banks.

11 Tips for Consolidating Credit Card Debt

  • Consolidation starts off with consultancy. Start off, consulting a trustworthy credit card specialist regarding your issues to know the various rates of interest offered by the banks available.

  • Calculate your debt on your own, to assure there has not been any error with the Bank calculations.

  • Choose the best way that suits you to pay off the debt.

  • Enquire about various rates of interest offered by the banks while you borrow a loan or if decide to transfer different debt-balances to one credit card account.

  • Be sure of the limits offered by the banks, to pay off the debt back to the bank.

  • Before taking one of these loans, try calculating all your sum of payments. Make sure, you make a fair deal by opting for the current method rather than paying off the debts individually to each Bank.

  • Choose between the loan you would opt for, whether it has to be a personal or a housing loan depending on your mortgage and the rate of interest offered to be paid.

  • Assure yourself if the debt calculated as consolidated can be paid off by you at the fixed date or no. Tell your preferences to the bank, at times they even tend to reduce the rate of interest for their customers.

  • Try and maintain your credit card score. It always helps reduce the rates of interest levied from the customers.

How Can I Consolidate Credit Card Debt?

Whether you are bothered by piling credit card debt or want to cut down the payments that you make on a monthly basis, consolidation of credit card is the way out.

As per a report by USA Today, non-mortgage credit rose to $3.6 trillion and non-revolving credit grew to $2.50 trillion. It does not matter whether you are having student loans or have a balance on your credit cards, it does have an impact on your daily lifestyle.

The things tend to get worse when various sources are responsible for the debt and you feel the heat in shuffling the payments every month. Such situation does lead to an overwhelming situation, but in actuality you can save yourself from going all through this. You can have salvation from all this agony through credit card consolidation.

Also Read – Credit Card Debt Consolidation For Bad Credit – Few Options You Need To Know

For this, you need to be familiar with the key tips so that you can save your hard-earned money –

Smart Tips To Consolidate Credit Card Debt – [Infographic]

how-can-i-consolidate-my-debt_consolidating-credit-card-debts

Knowing What Is Good Debt and Bad Debt

Nowadays, it seems that debt has become an important part of our lives. When the word ‘debt’ is mentioned, majority of the people have a negative illusion about it, but that is not how it should be.

It is an imperative step to analyze what kind of debt you have and accordingly you can set priorities for its payment or want to keep it for your daily needs. On the basis of two important questions, you can take a decision whether the debt is good or bad. You have to ask yourself whether the debt is ‘temporary’ or ‘lifestyle’.

Also Read – Top 5 Credit Card Scams In 2016

Set a goal

When you set a goal, in regards to the payment of your debt, things get a little easier. Choose a credit card, with the maximum APR, such as a secured credit card and increase the amount for which you will be paying. You can opt to reduce lavish spending and going out with your friends, to have extra cash to make that single payment.

When you are off paying to the first card, you can apply the same method to the next card. Repeat the same method till the time you have paid all credit card balances. It is also important that you keep a check, side by side, on the progress and stay motivated in order to meet your targets.

Transferring Your Balance

This tip can prove beneficial if your credit card balances are not too much or you are having a credit that has a large credit limit. The best thing about this is that you no longer have to apply for a fresh credit. If you think that transferring the balances to one single card is not a feasible option then you can transfer small balances in one single card. Owing to this, you don’t have to bear the burden of monthly payments as it will reduce considerably.

All the money that you save via payment of the debts will be much higher as compared to the interest that you will earn on your savings account. You can also use income tax refunds, pay increments or any other form of funds to pay the debts.

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Debt Management Plan

If you don’t possess the expertise to manage your credit card, you can always go for a debt management plan. Firstly, you have to choose a good debt management company to which you will be making a single monthly payment. Your company will further allocate these funds amongst your creditors as per your predetermined plan.

These plans often comprise of low rate of interests which further results in lower payments. If you have decided to take this route, make sure that you have spent extra time to search for a good debt consolidation company. Make sure that the prospective company has experience in dealing with credit card debt issues and does have a license. Such companies also provide consultation and tips for debt consolidation and related issues. Entirely depending upon your situation, you can also make the most of debt repayment and debt relief programs

Paying Small Balances First

When you are making initial payments for small balances, it actually makes you feel good that you are making progress. This will help you to feel good and at the same time motivate you further to keep paying off your debts. There are certain things that you need to consider, they are

  • Monthly payments – Make sure that you are making regular payments for your bills on a monthly basis. This will have a positive effect where it would add up to the amount that you are liable to pay.
  • Paying off your debt sooner – Needless to say that try to get rid of debt as soon as possible. This will further help you in saving money for your future endeavors and your credit card will also get saved from getting damaged.
  • Make changes in cash inflow – Make sure that you have done everything to cut down the size of monthly payments. This will help in lowering down the amount, hence giving a boost to the cash inflow.

Pay and Invest – You will be desperate to get rid of your loan but at the same time you also need emergency funds. It’s not that there is no solution to it but paying off your debts along with making investments can be done. But, your main priority is to pay off your expensive debts first and at the same time save money.

Nobody desires to land up in a situation where he/she will have to face the situation of debts, but in case you find yourself out of luck, the above discussed credit card consolidation will surely come to your rescue.


 

Why should you Consolidate Debt?

Consolidating Debt is a method to step out from juggling various liabilities. Consolidating Debt helps you confine your total debt with one lender. However, consolidating is favorable only where the rate of interest is low.

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*General information from publicly available sources, no credit repair or score services offered.

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We shall start up with understanding what is DEBT CONSOLIDATION –In simple terms it means to get a single loan to pay all of your smaller loans. The ideology behind debt consolidation is that making one payment every month seems easier to manage & the new loan may result in lower interest rate, lower monthly payment or a combination of both.

Debt consolidation loans are of 2 types:

Secured loans:

Under secured debt consolidation loan borrower can avail the loan amount depending upon the value of collateral pledged against the loan. Secured debt consolidation loan can be availed by anyone who agrees to place some valuable collateral i.e. regardless of their credit history borrower with good or bad can apply for secured debt consolidation loans.

Unsecured Loans:

In unsecured loans, the asset is not required as collateral. If the borrower fails to pay the money of the loan, the lender can eventually obtain a court order in an attempt to recover the money. The added risk for lenders results in higher interest rates. Approval of such loans are primarily based on borrower’s credit score (in addition to income and total debt).

People pitch to debt consolidation by highlighting 3 salient features:

LOWER’S YOUR MONTHLY PAYMENT AMOUNT

By consolidating all the debts they might lower your monthly payment amount but the reality is by lowering the monthly payment it is likely to take longer time to clear the debt.

REDUCES YOUR INTEREST RATES

It might be possible that the new loan may be available at lower interest rate but it often ends up with higher total interest to be paid.

MANAGEABLE MONTHLY PAYMENTS

We get enticed by the idea that instead of multiple we only have to pay one amount each month. But there is lot more in picture which seems unseen.

So to decide whether Credit card Consolidation is a Good idea or not: One must work on planned budget & improve savings & spending habits.

A very famous financial author once quoted-“DEBT IS NOT A PROBLEM; IT IS THE SYMPTOM OF OVERSPENDING & UNDER SAVINGS”.

Get rid of pending debts and liabilities

Debt consolidation is one of the competent ways to get away with your current debts. As per this, all your debts are rearranged into one single loan where the interest rate is on a lower side. If you are striving hard to break out of debt, a consolidation loan will surely deliver you from this situation.

It can also be said that debt consolidation allude to a loan which is, particularly, taken to get rid of pending debts and liabilities. There will only be one single loan for which there will be a single monthly payment.

Related – 13 Carcinogenic Debt Consolidation Myths You Ought To Know In 2017

Pros of debt consolidation 

  • Getting rid of bill collectors – Collection agents can really unsettle your daily schedule, this is where enrolling for a debt consolidation loan can prove beneficial. This will put an end to all annoying calls & letters and you no longer have to deal with the collection agents.
  • Organizing bill payment – With the help of debt consolidation, you get to reorganize your repayment to varied creditors, thus making one single monthly payment. When you have one single bill to pay in a month, you have to care less about making minimal payments to different organizations. Moreover, you get to extricate yourself from remembering the due dates every single month. All you need is to pay a bill every single month and you no longer have to take care of the accruing late or missed payments.
  • Fixing the credit – If you are not able to cope up with the monthly payments of your credit card, there are strong probabilities that your credit rating is descending. While your credit report card may undergo a primary ding, all the negative records of missed payments instantly stops when you enroll yourself in a credit relief program.
  • The prime most advantage of debt consolidation is that all our debts are in one place, so we have only 1 interest rate to keep track of & one payment to make every month.
  • Debt consolidation aids in managing debts effortlessly because you have to make 1 monthly payment to your financial institution, rather than bunch of different payments to different lenders.
  • Using debt consolidation one can also close down other credit cards & loan accounts which will revamp their credit rating by showing lenders that your finances are managed properly.
  • Since the interest rate of the new loan is generally lower than the existing small loans, you will pay less of your money to interest, getting you out of debt faster.

Related – Private & Federal Student Loan Debt Consolidation and Settlement

As and when your consolidation agency receives timely monthly payments, they further update leading credit bureaus, thus helping your overall credit ratings to improve.

  • Constant Instructions – A reputed debt consolidation agency will not only provide you loan so that you can pay off your creditors, instead they should impart information that will help you to make you more responsible towards your finances in the coming times.

You should acquire knowledge of setting up a budget, set financial goals for the coming future and plan an emergency fund by taking guidance from a reputed credit card consolidation company.

Cons of Debt Consolidation 

  • Unjustified Fees – There are consolidation agencies which charge high fees and interest rates are also on a higher side. This will mean that you will use majority of the monthly installment to pay off the interest, thus making it difficult to pay off the debt. The interest rates can also rise unexpectedly, worsening the things for you.
  • Low Interest Rates – Majority of the people are of the view that the low rate of interest will help them to save more which is not correct. Usually the term for debt consolidation loans stretches for a longer duration, this will mean that your total interest payments will amass to pricey debt.

If you think that paying off short-term debts such as personal loans or credit cards over a longer duration, with a lower rate, will be a good idea, think again. In real terms, this actually means that you will have to pay more interest in the future

Related  – Which Are The Best Ways To Consolidate Your Student Loan Debt?

  • Additional debt – Some people have a wrong illusion that debt consolidation is a way through which they can get rid of the debt. Alas, majority of the consumers are of the view that the zero balance is actually a green signal for them to go extravagant while spending. But, all this will only end up making things worse.
  • Cutting down the debt – Debt consolidation replaces current debt with another debt which most of the people don’t realize, so this cannot be a solution for all those consumers who are over-indebted. There are certain things that you should follow for financial well-being – spend less, save money and pay your debts with your money.
  • One of the main disadvantages of debt consolidation is that one might end up paying more interest than you need to on some of your borrowing. Debt consolidation can make debts more expensive and may take longer to pay them off. One must remember when we consolidate debt we end up owing same amount of money but the difference being that the length of the term increases which indicates paying more money through interest.
  • Debt consolidation may reduce your monthly installment & give you short term breathing space but it will result in paying interest for longer tenure.
  • It’s a myth that debt consolidation reduces your debt rather it may lead to more debts by giving you an illusion that the debt is being paid off.
  • If you have used your house or any other valuable asset as collateral you can risk losing it if you are unable to pay the loan installments.
  • Therefore debt consolidation is not a solution for over indebted consumers. In order to get on track of financial well being one must spend less, save for emergencies & pay off their debt with their own money.
  • Next point to be taken into account is that how do you qualify for debt consolidation loan:
  • To see if you are eligible for consolidation loan the lender would examine your credit rating because lending institutions will use your credit score & payment history to determine risk. If borrower has bad credit history or large debts, the borrower may offer a secured loan.
  • The lending institutions also delve into the regular source of income of the borrower to analyze whether you will have enough cash to pay the loan installment after meeting your daily living needs.
  • Lending institutions may need a cosigner for the loan or provide collateral such as house or car, which borrower will pledge as security to ensure he pays back the loan.

Related  –  Credit Card Debt Negotiation – An Expert Guide

Should I choose debt consolidation

At the end of the day, it is your personal decision whether the debt consolidation is right for you or not, if yes than our credit card debt specialists are availaible to you for providing expert advice on how to pay off your credit card debt. Now that you have a fair knowledge of the pros and cons of debt consolidation, you can make decision on your own. All you need is to consider the above discussed information and you cannot go wrong.

Related  – What is Credit Counseling and How It Can Help You Reduce Debt Problems?

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What is Credit Card Debt?

No doubt credit cards have become the most popular way amongst everyone for shopping and buying items from shops as well as paying online. As it gives us the liberty to pay back money installments later.

If used wisely it is definitely a useful tool, but  if you fail to do so then surely it can cause plenty of trouble for you and can prove to be an expensive way to borrow.

Let us know what are the risk and how can you manage your credit card debt and credit worthiness.

Credit card arrears- money that is due and should have been paid earlier.

If you due to any reason you are unable to pay the minimum amount on the due date every month, your account will go in deficit. You will definitely get calls from your creditor will contact you to get their default payment.If you still fail to make the demands meet then you will be stated as defaulter and further action may be taken against and the creditor can drag you to court.

Credit Card Debt Negotiation – An Expert Guide

Credit Card Limit

Whenever you get a credit card it comes with a credit limit. This credit limit is judged at various points. Such as people with a poor credit history and have a low limit. These cards have a high interest rate. You can portray a good credit image by paying off your credits on time also you can build up the creditors trust upon you. Irrespective of you having a low or high credit limit, you can have an affordable debts which takes a while to pay back.

You may come across times when your card provider will try to convince you to increase your credit score, especially if you have had a good repayment history. Though it is solely up to you whether to accept or not but you should think twice before agreeing to an increase in your credit limit,

Agree only if you genuinely think that you need it. As some people like to get a higher limit for fun or just for a show, there’s always the temptation to keep spending and but at the end of the day it happens that you run up a debt which you eventually can’t afford to pay back.

Settling Credit Card Debt

How much is the interest and charges on credit card debts that you pay?

  1. Interest rates varies from 10% to 70% or more. Remember that at the end the rate of interest you’re charged will depend on your credit rating.
  2. With few of the cards you may even get interest-free 60 days on purchases. This indicates that if you pay within this period you won’t be charged any interest.
  3. But most will charge interest straight away on money you withdraw from a cash machine.
  4. If you miss you’ll have to pay late payment charges on top of the interest.

 

Also read – Cost of Carry Credit Card Debt

Extras that you get when you spend on a credit card

While you spend on your credit card one important benefit that you avail is that you get extra cover on larger purchases.

If your purchases are between £100 and £30,000, then the credit card provider is also responsible for the goods or services provided.

Understand by this example: if you paid for a holiday with a credit card but the company went bankrupt then you can claim the money back. Or the most common example is when you order something online but they don’t arrive you could claim back your money that.This cover applies even if you only paid part of the amount with your card.

Private & Federal Student Loan Debt Consolidation and Settlement

Joint credit card debt

Unlike the joint accounts in the bank, there is no provision of having a joint credit card. The credit card account to be in one name. But you can surely avail another credit card for your partner. If your card provider has given you a second card, you will be liable for all of the money spent on both cards. Only you are liable to make payment for both the cards. Even if the 2nd card is for someone else still only you are supposed to make the payment. Hence do think nicely before getting a new credit card.

What is PPI on credit card debt?

Many credit cards have payment protection insurance (PPI) to cover the minimum payments if you became ill or lose your job.

There were many people who did not require these PPI policies still these were sold to them If you are also one of them, then you can ask the credit card provider to refund the payments to you. This could reduce your credit card debt.

Credit card balance transfers

You can transfer balance from your card to another. Though these are a feature of only some credit cards. YOu can try transferring a debt from a card with a high rate of interest to one with low or 0% interest as it can help you pay off the debt faster.

0% interest credit cards

Some cards have a special feature where no interest is charged for only a certain period or for an introductory period where no interest is charged. This period varies for 18 months or more. If you transfer to a 0% interest card, check the rate of interest when the 0% deal ends as this could be high.

Credit cards and your credit file

You can even get help from a genuine and trustworthy credit card debt settlement agency with whom you can share the information with, about the way you use your card. This information can further help other creditors to see and decide how risky it is to lend you money whether.

Your credit file will show the following information about your credit card debts:

  • The balance owed
  • Your payment history
  • Whether your account has defaulted

Other information that are showcased are

  1. Your credit limit
  2. How much you’ve spent each month
  3. How much money you’ve withdrawn from a cash machine each month

Credit Card Debt Negotiation

It remains very much possible to negotiate terms, interest rates and payments on credit card debt. You may also attempt to negotiate a settlement of the amount owed by you. The steps you employ and the options’ availability will depend to a large extend on your particular situation and the credit card company’s stance you’re dealing with.

When Can You Negotiate With Your Credit Card Company?

In most instances your negotiation strategy is largely dependent on the timing. If you’re having no trouble whatsoever with your payments, you’re very likely to get a better interest rate, while if you find yourself in the midst of financial hot water, you might be able to get better payment terms dates, or even a short reprieve from payments.

  • When it’s all merry and good

If you’re all comfortable with your debts and have a reputable credit history, you may want to get in touch with your credit card companies and ask for a lower interest rate. While they may initially be reluctant to concede you any benefit. But if you give a slight hint to them that you would consider switching to a card with lower rate, they might agree to work with you.

  • When you’re under the burden of financial difficulties

Although credit card companies encourage people to call them in circumstances of financial hardship and with inability to pay off debt, some would be amenable to listen to your case than others; so it’s anybody’s guess as to how they’ll respond when you do call them.

Ideally, when you can foresee that there will be a slight delay in your payments or if you perceive making a few days’ change in your regular payment(say moving the date from the first of the month to the middle) would make it easier on you to pay on time, then by all means you should inform your credit card companies. A great number of companies are even generous enough to provide you with relief in case you find yourself out of work, or subject to some illness or family emergency that need tending to.

On the other hand, there are a lot of companies who won’t show any signs of clemency. The moment they get a hint that you’re in some financial difficulty and won’t be able to pay off your debt, they’ll waste no time in cutting off your credit. Therefore, you have to show utmost discernment as to when you plan to communicate, who you plan to communicate with and how much you communicate about your financial woes. So when you do call, get yourself absolutely prepared to respond to the credit card company’s inquiries. At last, don’t let an unpleasant experience with one creditor discourage you – others may take a totally different approach about negotiation credit card debt.

Also Read – Credit Counseling Can Help You Reduce Debt Problems

Credit Card Settlement Options

There are a myriad of options available for negotiating a credit card debt settlement. A few of them are mentioned below:

  • Moving a payment date
  • Reducing the interest rate, or
  • Asking for a temporary payment reduction

In case you’re seeking bigger concessions from the credit card company, the credit company will deem it appropriate to cut off your credit until you’re fully paid up, or maybe for an extended length of time too. But if your financial troubles aren’t showing any signs of relenting in a few months times, you’ll probably have to discuss the following possibilities with your credit card issuer:

Also Read – How To Get Out Of Credit Card Debt? Your Options

Who should you talk to at the Credit Card Company?

Who you talk to at the Credit Card Company largely depends on what you’re trying to negotiate:

  • Seeking change of payment date: If all you want is just a change in the regular payment date (likely to coincide with your payday etc), you can pretty much talk to anyone in the customer service to get assistance.
  • Interest rate reduction : When the purpose of your call is to ask for a reduction in the interest rate, it would necessitate getting the manager involved.
  • You expect a delay in your payment : Most companies have a dedicated department taking care of the calls on such matters. You could simply apprise them of your situation and approximately how late you’ll be in your payments. If you notify them in advance they may be kind enough to even waive off the late fee on your payment.
  • Negotiating settlements or long-term payment plans: If you’re calling to explain a more critical situation, the customer service department may not be able to help you at all, despite making claims that they can help. Communicate politely with the representative, but if the conversation seems to be taking a less agreeable direction, then you might inquire if there’s another department you could speak to or any other supervisor who might be able to provide further assistance. It might be a while after being transferred from one department to another you finally reach someone who has authority to negotiate.

Don’t forget to get the agreement in Writing

Irrespective of the outcome you reach, whether a less or a more favorable one, make sure you get it in writing and strive to stick to your payment plan. If you’re in still worse financial trouble, get in touch with your creditor so you may renegotiate before falling behind. If you wait too long and eventually default on the settlement payments, the creditor may be very unwilling to renegotiate with you.

Seek still further help!

If you find your credit card company isn’t helping you enough, you might consider getting help from outside sources, which include:

  • Credit Card Counselors : Go for the non-profit agencies that readily provide free or very low cost services. There is no shortage of scams, without doubt, so carefully assess which companies to use and get a clear understanding of which options to avoid for example debt management firms and variety of debt settlement companies.
  • Bankruptcy Attorneys :  A Chapter 13 bankruptcy allows you to keep your property intact while paying off all or part of your debt over a period of three to five years, mostly when the creditor doesn’t agree. Furthermore, by filing for Chapter 7 bankruptcy, many debtors can safeguard themselves against losing property of any proportion and discharge their credit card debt.

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