Know your options about credit card debt
Hello my name is J. Sellers and I have been assisting people that are in arrears with their credit cards for a considerable amount of time and know the negative consequences it has on someone’s life. When you have credit card debt and know that this matter is no longer something you can control, you should make a decision and make it quick. You do not want to procrastinate until it is too late. As many of you already know is that the collectors are not polite when you call them with problems regarding you statement. It’s very remarkable the way it works because when you first obtain the card they are pretty nice people while you are on the phone. Then if you contact them to argue against a late or over limit charge and try to have it , they might let you off once a year, if you are lucky. When it comes down to it what decision are you going to make. It’s not like you can stop making payments on your rent/mortgage or other requirements for you and your family to survive with day to day expenses. why not look into your other options with credit card debt relief
The credit card industry made a whopping 17 billion dollars in controversial fees in 2006 and it will be significantly higher this year. Now I am pretty sure that it has happened to you, where you go and open your monthly credit card statement only to find out that your APR has more or less doubled or even tripled. It is bad enough to try and keep up with 10% or even the 7.9 % interest that they are charging on your credit cards. How are you suppose to manage the new payments now? It was dreadful enough to manage before the interest skyrocketed. This is exactly why U.S. citizens are searching for other options such as credit card debt settlement vs. credit counseling, or bankruptcy. If you are not familiar with any of your options then I will give you a little bit of an education on them.
Bankruptcy
Up until late 2004 bankruptcy was to be used for consumers who were having severe financial problems. Regrettably it was mistreated by far too many debtors who wanted to avoid paying their debts. They did not want to be accountable for their misgivings. The credit card companies were fed up with this so they pushed to have the bankruptcy laws changed. It is now referred to as the Bankruptcy Abuse Prevention and Consumer Protection act of 2005. This would make it more difficult for many consumers to file for help. Bankruptcy should only be considered as your last resort option after you have tried every conceivable option. Also you should think of the consequences that might come back later down the road. You would have to locate a lawyer, go to court and that could cost you a substantial amount of your hard earned income. There is also the issue of it being on your FICO report for a long time. When you sign any important application or document you will always have to answer yes when asked the question about bankruptcy, so this does have a extremely long lasting effect on your ability to obtain future credit.
Consumer Credit Counseling
Everywhere you turn, either on TV or the radio, you will hear about credit counseling. A credit counseling agency will try to get the creditors to reduce the APR on your credit cards. You then make one monthly payment to the consumer credit counseling agency and they then make your payments to each one of your creditors for you. The fallback to this choice is even though they reduce the interest rate on your credit card accounts you might still pay back as much as 130% of what you actually owe.
This is because joining this sort of plan you will still be paying back what the full original balance was plus some of the interest for around possibly five years or more. Almost seventy five percent of the debtors that are in these programs don’t complete the program for one reason or another. Another downfall to credit counseling is that if you have a income problem and are short on your monthly payment they will kick you out of the program immediately. They will also increase your interest back up and the creditor could keep you off the program for around one year and perhaps even longer. This will put you right back to where you began, if not in a tougher situation.
Credit Card Debt Negotiation (also known as credit card debt settlement)
This is the option where you can save the greatest amount of money. A competent credit card debt settlement company will save you at least 40% of what you owe. The 40% should include all the fees as well. Similar to consumer credit counseling, you will hear a lot of radio and television ads all the time. These organizations are starting up everywhere across America. Some of these companies try to make it appear like they have a magic button and are going to make all your debt vanish extremely easily.
There are even some companies that try to use religion to attain the trust of people. Whichever organization you are going to use it is your responsibility to do research on them. You should begin with the BBB (Better Business bureau). You should be able to discover quite a bit about a company from the Better Business Bureau. If you find out that a company has only been in operating for a little while and has a lot of complaints against them, then you know to avoid them. Another thing to look for is how long has the company been in business. Some organizations only make it a short time before they get terminated or get caught with their hands in the cookie jar. Then some of them only stick around to make as much money as they can and close down just to open up across town.
J. Sellers is a debt analyst and works with US Consumer Advocate