Everyone today is worried about credit card debt, but in most cases they don't know how to do anything. In fact, most people do not know how to withdraw once debts are in trouble. In fact, for most people, entering debt is much easier than getting out of debt, especially credit cards. Among all debts in our society, credit card debt is the main reason for bankruptcy and debt management programs.
Special effects
How did it get started? Unfortunately, banks play an important role in the high credit card debt that many consumers carry. With the advantage of taking advantage of low interest rates, that is, after one year expires, reward cards with no annual fee can enjoy all the functions from free flight mileage to cash rewards. Cardholders quickly seize these cards in order to be able to make full use of multiple Rewards provided. The bonus offer was the beginning of a financial disaster that eventually resulted. Unfortunately, many of these benefits are targeted at young people - new high school graduates, college students, and recent college graduates - who are not yet sufficiently mature to understand the importance of having a good reputation or even how to handle credit cards. Due to the lack of early knowledge about credit cards, there will be financial confusion in the future.
Sadly, many people didn't realize the impact of credit card debt until they were caught in credit card debt until they couldn't see a way out. For many people, the most classic sign of having too many credit card debts - can only afford the minimum payment - is not a problem. Until some time, the actual impact of excess credit card debt began to appear - that is, missed payments, even unable to pay the minimum payment, the credit limit reached or exceeded the established credit limit, and borrowed from one card to pay for payment on another card. Sometimes people with serious credit card debts will apply for another credit line with a lower interest rate and originally intended to remove other cards and use the new card. Some people may even come up with a consolidation loan. After the balance is paid on their credit card, they start using them again instead of getting rid of them. For some people, the reality will not come home until the receiver closes the door and the verdict will be issued. They try to apply for a loan. They just find that their credit has been seriously damaged and they have even borrowed hundreds of dollars to buy some furniture.
Solution
Once your credit card has encountered some financial problems, the next step is to develop a plan to eliminate the debt and get up again. Depending on the severity of the damage, you can use multiple plans. The following are some solutions, starting with the debtor's procedure, the debtor's losses being minimal, and the worst case ending.
*If you are one of the lucky ones who are aware of financial problems before the financial problems are completely out of control, then solving the problems is much easier. If your credit card debt is still at a reasonably manageable level, one of the easiest ways is if all the balance is close to the minimum balance (or the highest interest rate), and add some additional monthly funds each time. Even if there is only $10-15, anything higher than the minimum payment can help reduce the balance more quickly. So if you only have to pay an extra $10-15 per month? Here's what it's like: When you pay off your first credit card, take all the money you paid and add it to the second highest balance or the minimum amount on the rate card. In other words, if you pay a total of $50 a month on credit card #1, when you pay in full, add the same $50 to the payment on credit card #2. Please follow the same process until all except for extreme emergencies (cars or home appliances not working, medical bills, sickness drugs), otherwise the credit card will be paid in full, and these credit cards must not be used and in no case may be used You are paying the credit card in full. If you have more than two cards, delete the card for commercial use only.
*Another exit you may want to use is a consolidation loan. Of course, in most cases, you need real estate to get a consolidation loan. This will give you a longer term and lower interest rate, but if you use your house as a collateral, you must be careful. When you have fully paid for these cards, cut them off or lock them until you finish paying off the consolidation loan. Some people made the mistake of a merger loan and just started using the cards again and created the same financial situation they had just developed.
*Some card issuers have a plan to lower interest rates and payments, but if you have several cards, this plan may not be suitable for you. If you miss a payment, the plan will become invalid and you will be back in place.
*Debt consolidation involves working with debt management companies to formulate repayment plans. They will work with your card issuer to get a lower interest rate, and sometimes even cancel the interest rate altogether, so that you can make a payment to the debt management company and the company will distribute the payment to your credit card company.
For those who wait too long, bankruptcy may be the only answer. This is a step you want to avoid as much as possible, so unless you are excusable, you should recognize your financial situation before you can work with your creditors.
Copyright(c)2008 Billy Alvaro
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Orignal From: Credit Card Debt - Effects and Solutions
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