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Credit Card Debt: How To Control It
A lot of people spend more money than they can afford to repay
toward their credit card debts. To regain control over your
finances and to manage your debt, here are some solutions you can
try.
CREATE A SPENDING PLAN
In many cases, people design and then stick to a spending plan
to get their debt under control. A spending plan is a guide for
how much money you have and how much money you spend. Sticking to
a realistic spending plan allows you to pay off your debts and
save for the proverbial rainy day.
CREDIT COUNSELING
Many universities, military bases, credit unions and housing
authorities operate nonprofit financial counseling programs. Even
though some may be called non-profit, a fee may be charged for
their services.
Creditors may be willing to accept reduced payments if you're
working with a reputable program to create a debt repayment plan.
When you choose a credit counselor, be sure to ask about fees you
will have to pay and what kind of counseling you'll receive.
A credit counseling organization isn't necessarily legitimate
just because it says it's nonprofit. You may want to check with
the Better Business Bureau for any complaints against a counselor
or counseling organization. DECLARING
BANKRUPTCY
Bankruptcy is considered as an extreme last resort credit
solution. Unlike negative credit information that stays on a
credit report for seven years, bankruptcies stay on a credit
report for 10 years.
Bankruptcy can make it difficult to rent an apartment, buy a
house or a condo, get some types of insurance, get additional
credit, and, sometimes, get a job. In some cases, bankruptcy may
not be an easily available option.
WHEN TO CONTACT CREDITORS
If you're having trouble paying your bills, contact your
creditors immediately. Tell them why it's difficult for you, and
try to work out a realistic modified plan that reduces your
payments to a more manageable level.
Don't wait until your accounts have been turned over to a debt
collector. At this point, it may be too late. Take action
immediately and keep a detailed record of your conversations and
correspondence.
USE CAUTION WITH DEBT COUNSELING
Turning to a business that offers help in solving debt
problems may seem like a reasonable solution when your bills
become unmanageable.
Be cautious. Before you do business with any company, check it
out with your local consumer protection agency or the Better
Business Bureau in the company's location. One rule to remember
is that if a credit repair offer seems too easy or just too good
to be true, it probably is too good to be true. And knowing your
rights can help you steer clear of rip-offs.
As you try to take control of your credit card debt, be on the
lookout for advertisements that offer quick fixes. While ads
pitch the promise of debt relief, they rarely mention that this
relief comes in the form of bankruptcy.
Because bankruptcy stays on your credit report for 10 years
and hinders your ability to get credit, it's important to ask for
details before agreeing to any debt-relief services.It's a good
idea to check the information found in your credit report at
least once a year.
Since credit reporting agencies don't share files, you'll need
to contact each reporting agency to make sure the information
about you is correct. The three major credit reporting agencies
are: Equifax (1-800-685-1111); Experian (1-888-397-3742);
TransUnion (1-800)-888-4213.
Jamie Madison is the webmaster at http://www.ReviewMyCreditReport.com
where you can request a FREE copy of your credit report. Visit
today for a copy and keep track of what your credit report says
about you.
MORE RESOURCES:
Credit - Google News
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