Credit Card Debt Relief

Personal Finance

It’s astounding how many people search for “credit card debt relief” every month. An estimated 31,620 searches a month and that is not even including all of the popular search engines. Like I stated in previous post, I often look for popular questions people my have in order to answer some of them with my own views and opinions. Interestingly enough I too am seeking answers. For example, why does everyone search for “debt counseling” and “credit card debt relief?”

Why do people get sucked into the phony radio and television ads that promise to have you debt free within a year? Common sense and simple math will shed light on the BS that falls from these sales people’s mouth. Debt consolidation is not necessarily a bad thing, especially if you can acquire a low rate…One lump some payment is easy to maintain and if your rate is low enough, then most likely you will achieve what you set out too. Unfortunately many people who look for debt consolidation or turn over their finances to a debt consolidation companies have bad credit. Therefore low rates usually aren’t in the debt free formula.

So the question that so many seek: How to get out of credit card debt?

The answer is simple but your actions must put the wheels in motion. First things first, it’s completely SHOCKING how many people still use there credit cards considering they are border line bankruptcy. Some people are habitual spenders and some live off their credit card. If you can’t control your spending, then you need to close the line of credit. To get out of credit card debt means you can no longer utilize the line.

Secondly, most who are overwhelmed with credit card debt have many credit cards. Determining which one is your highest interest card is the one you should focus on first. If your rate has jumped to the default rate of 30% due to delinquency or paying late your first objective if credit permits is to look for a fixed or 0% balance transfer promotion depending on the balance. For lower balance opt for the 0%, for the high balance cards try to locate a fixed rate. Also be sure to watch out for the balance transfer fee. Ideally you shouldn’t spend more than 3% for the transfer.

Create a budget to see where your money is being spent. You should pay your minimal balance on the lower rate cards and try and double or even triple the payment on the higher rate card. Activate your email notifications on your credit card accounts and also setup auto pay for the minimal to avoid paying late and having your rate increased.

It’s alarming to find when one computes their budget how much people actually spend on fast food and unnecessary outings each month. It’s now time to start living by your means, lavish cars, expensive dinners and shopping on the weekends should be eliminated and reality should take hold. No one can be held responsible for your finances and actions but you! If you think you’re a Diva, keep spending and you will be a BK Diva. Take the money you would normally spend and apply it to your credit cards. Most will find that they should be able to apply $300.00 to $400.00 extra each month on their credit card from what they save by not eating out and shopping. Debt consolidation companies claim to be able to decrease your rate and minimize your payments. All they do is mail your payments to your lenders while earning a percentage from you often paying late and damaging your credit and having rates increase. Yes, some debt consolidation companies try to haggle for settlements or lower payments but there attempt will likely fall on deaf ears. What makes you think your lender will be willing to speak to them and work with them anymore than they would you? How do I know this? Because I spoke with these debt consolidation businesses on a daily basis, the institution I worked for didn’t work with third parties but that didn’t stop the attempt.

How many reputable credit card debt consolidation companies can you name? How long have they been in business? The fact that they can’t stay in business should be an eye opener. This post was not to bash you but to try and shed light on a situation that is tearing families apart in a time people should be pulling together. Don’t trust your lender, don’ trust debt consolidation companies, grab your debt by the horns and take control. We don’t live in a totalitarian country, don’t expect the government to step in and create new policy to get you out of debt.

Have you achieved debt free status? If you care to share, we would love to hear what you did to become debt free.