Credit Card Debt Elimination
Being in debt and mismanaging finances can place a person or even an entire household in a difficult position. In order to free oneself from debt, a lot of individuals consider filing bankruptcy. The recent revisions in bankruptcy laws have changed the situation. With these new laws, it is not as easy for people to be debt-free via bankruptcy. Still, there are still some people and circumstances to which bankruptcy is applicable. However, the effect that bankruptcy brings can last for years. When thinking about filing for bankruptcy, one should first find other options to eliminate debt. Here are three credit card debt elimination strategies which may help.
Credit Card Debt Elimination = No More Credit Card Usage!
Those who do not file bankruptcy have different decisions to make. For example, one person who has amassed 20,000 of debt is in a different position to someone who has 5,000 of debt. The one who has a smaller amount of debt may be able to pay the balance owed without even filing bankruptcy. The person who has $20,000 amount of debt doesn’t have to file bankruptcy, but they would have to make a huge personal sacrifice to eliminate their debt.
If you are in really serious about credit card debt elimination, credit card usage should be limited. Actually, if one can help it, stop using credit cards at all. Another tip is to pay more than the monthly minimum. Do you know that monthly minimum payments hardly cover additional finance fees? In order to be able to reduce balance significantly, pay the required minimum amount monthly and add $50 or $100 more.
A successful credit card debt elimination plan is rooted in one’s discipline and sacrifice in just using cash to pay for living expenses and necessities.
Credit Card Debt Elimination Options
Request Lower Interest Rates
If negotiation with the creditor is possible, grab the opportunity to seek lower interest rate. Usually, this can be asked if one has been a good payer to the credit card company.
When asking for a reduction of interest rate, it is best to put the best foot forward. Having a good history of credit and repayment may be able to convince the creditor to reduce interest rates.
Credit score also plays a role when a creditor considers interest rate reduction. A low credit score might need the assistance of debt consolidation agency.
Once your interest rate is lessened, is it much easier to reduce the outstanding balance. This is because your financial fees will be significantly lessened.
Refinancing or Home Equity Loan
Homeowners have an advantage when trying to eliminate debt. Why? Because values of homes increase through time, therefore owners gain equity on their property. When one is a homeowner, it is possible to tap into the property’s equity. Refinancing a home or getting home equity loan will enable the owner to have a considerable amount of money which can be utilized for debt consolidation.
These are just a few debt elimination strategies which can be included in your credit card debt elimination plan. Remember, managing finances properly can lead to a debt-free comfortable life. So click on the link below to see how credit card debt elimination can help get out of debt.