If you want to learn how to fix credit, you are going to have to make some tough choices and some of your considerations will be deciding what to do with credit card debt.
Credit Card debt is the most destructive type of debt we have. One of the reasons for this is because , it is very easy to apply and to receive approval for a credit card. Even high interest credit cards are available and this ability to rack up debt is a growing,insidious disease eating away at our economic fabric .
Second , this debt is consuming in that it never seems to go away . Minimum payments are a welcoming committee for a life of prison time as you never seem to be able to knock down the balance.You can’t ask the question how to fix my credit without a plan for dealing with credit card debt.
If people really understood how dangerous consumer debt is, this get out of jail card we carry in our pocketbook and flip out at whenever we want what we can’t afford, well, this practice should be outlawed.
Congress recently addressed this growing problem and although the lobbyists are incredibly powerful, this idea of credit and paying it back for years , there are a few new laws governing the banks and lenders issuing these cards.
Have you looked at your statement lately? Are you appalled at the number of years it will take to pay off some of your charge card debt? Can you imagine paying for years for something that has long ago expended it’s life? That patio furniture that has long ago been replaced? Are you still making those payments ? How about a washing machine you needed? Does everything still work or have you moved on to another model?
Paying consistently for your credit card purchases is like debtors prison and if you are embarking on a campaign to increase my credit score, you must decide how to handle the debt that takes all your money each month. Here are some things you may want to try to do .
1. Bite the bullet and pay the balance . If you get inheritance money or score a windfall from some long lost investment, now is your chance to eliminate your overhead . Get out of debt .
2. Call the lender and ask for a lower interest rate . Tell them the possibility is that your financial situation may prevent you from paying your obligations . If they refuse, don’t give up . Credit card companies do this all the time and why not for you?
3. Bankruptcy may be a solution , but you need legal help to determine if your debt can be discharged. Some credit card debt is exempt, so don’t run out and make a big purchase thinking you may not have to pay for them.
4. In extreme cases you might consider a debt settlement or creditcard forgiveness. This is where you pay about 20 cents on the dollar for a settlement in full. You can do this yourself and it gets complicated . There are all sorts of strategies and time lines you need to pay attention to. Be aware that you will be responsible for paying the income tax due on the forgiven debt as the IRS considers this a gift .
