Reduce Credit Card Debt
Contributed by Rachel s Pickett
Reduce Credit Card Debt
Thousand of people each year find themselves faced with credit card debt. You lost your job, used credit to make ends meet, used your credit too much, or had an emergency and now you are faced with higher interest rates and late fees. Your debt seems to be growing larger instead of smaller. The most two important things to remember are to avoid declaring bankruptcy and keep paying your bills.
Bankruptcy
Declaring bankruptcy will severely harm your credit report and score for approximately 7-10 years. Always use this option as a last resort.
Paying your Bills
It is very important to keep paying your bills. Most creditors would rather have you make lower payments, then not pay at all. If you find you are having trouble making payments to reduce your credit card debt, call your lender right away. A customer service representative should be able to help you set up a payment plan that is lower than your previous rate.
Paying your bills each month, on time will help you keep interest rates on your credit cards or loans from sky rocketing. For example, you have a credit card with 18% interest, and you are $8000 in debt with that credit card, and you stop making payments for a period of one year. At the end of that year you will have acquired $10,000 in late fees and debt, and your interest rate can go from 18% to 28% or more. Paying your bills on time will help you from making your debt larger and harder to pay back.
