Unpaid Credit Card Debt
It’s all too easy to fall into the credit card trap. You get credit with the best of intentions, and may even be able to pay off the balance in full for the first month or two. At the very least, you are able to pay much more than the minimum amount due. Then something happens. Your unpaid credit card debt starts piling up and soon things seem completely hopeless.
If this sounds familiar then you should know that you are not alone. Millions of people are in the same situation, but some of them have found a way out of it. In fact, there are several ways that you can take care of unpaid credit card debt, but it’s up to you to choose the method that is best for you and your situation.
You need to find out exactly how bad your situation is. Get out all of your most recent credit card statements and note the total balance owed, minimum payment due, interest rates, and any fees or penalties that may apply. You now have a starting point to work from, but you also need to keep your end point (most likely getting out of debt) firmly in mind as you fix your problem. It will be very difficult at times, even discouraging, but as long as you “keep your eyes on the prize” you will come out ahead.
Now that you have solid fix on the situation, you need to make a plan. Here are your main options:
Make deals with your creditors: Just about every credit company is willing to strike a deal with you if you are in a rough spot financially. Whether it’s a loss of job, lower income or medical emergency, they have programs in place to get you over a hurdle. You may have to specifically ask about their “hardship program”, and you will have to prove your eligibility. If you are approved, your payments could go down substantially for six months to a year. Some credit card companies will let you renew your enrollment in their program once the initial term is complete, but you may have to re-prove your eligibility.
Take out a debt consolidation loan: This always sounds like an attractive option, doesn’t it? The promise is that you can take all of your high interest debt and roll it over into one, low interest debt. The total amount you pay each month goes down, and you only have to deal with one debt instead of several. The reality is that most people who get such loans only dig themselves a deeper hole. You have to be incredibly disciplined to make it work, but if you were disciplined enough then you wouldn’t need to consider consolidation.
Don’t pay: Believe it or not, this can be a good option, at least for a while. By not paying, the credit card company will become more desperate to make a deal with you because they would rather get something than nothing. This is a last resort measure, and you shouldn’t push it too far, but it can be one way to help you get things back under control.
Declare bankruptcy: Not a real option for unpaid credit card debt. Don’t do it.
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