I’m always amazed at how credit card debt can creep up on a person. It can seem like you owed only a few hundred dollars on one card a couple of weeks ago and now you owe several thousand. You wonder how did this happen?
Americans are now carrying more credit card debt than at any time in the past. I saw one report that the average US credit card holder is now carrying $15,900 in unsecured debt. Since that’s an average, you can only guess at how much debt some people are carrying– $50,000, $100,000 or even more. Wow!
It may not even be your fault
You may be one of the millions of Americans who are unemployed or you may be underemployed–a sort of fancy way of saying that you do have a job but you’re earning much less than you were just a year or two ago. Whichever is the case, you may be doing what many people are, which is using your credit cards to pay for everyday items such as groceries, dry cleaning, the occasional movie, clothing, gasoline and etc. What happens once you have to start doing this is no secret–your credit card debt starts increasing geometrically and before you know it, you’re thousands of dollars deeper in debt than you were just a few short months ago.
How to get debt relief with credit cards
There are several different ways you can achieve debt relief with credit cards. The most popular of these are a debt management plan (DMP), a debt consolidation loan, debt settlement or bankruptcy. As you might guess, each of these has its pluses and minuses. For example, a DMP can save you money by reducing your monthly payments and giving you more time to pay your bills but does nothing to reduce your debt. The second option, a debt consolidation loan, can get you lower monthly payments but again does nothing to reduce your debt. You’re basically just moving it from one set of creditors to another. You’re going deeper into debt to try and get out of debt. You’ll have more time to pay back the loan but that’s not necessarily a good thing as you could end up paying more in both principal and interest.
Filing for bankruptcy
You can also get relief from credit card debts by filing for bankruptcy. This will discharge (eliminate) most of your unsecured debts, including your credit card debt. People generally choose a chapter 7 bankruptcy so that they can keep some of their possessions but be forewarned you may lose some of your nonessential possessions (think boat, mobile home or vacation home). A chapter 7 bankruptcy won’t discharge all of your debts, including student loan debt, money you owe the IRS and back child support or alimony. And it will stay in your credit record for ten long years, during which time you might not be able to get any credit including a mortgage or renting an apartment.
Not even debt settlement is for everyone
We recommend debt settlement for debt reduction, which is an excellent way to get debt relief with credit cards but not for everyone. You have to owe more than $10,000 in unsecured debts (read credit card debts). Debt settlement works better if have not made even the minimum payments on your credit cards for the past four or five months. However, if you do fit this profile we can probably negotiate settlements that will reduce your debts to a fraction of what you really owe, and help you with a payment plan you can afford. You can get credit card debt relief and be on your way to becoming debt free in a few short minutes, give us a call and let us show you how we can help you.