How to Get Out of Credit Card Debt
Credit cards have become an indispensable part of our lives. Almost all of the purchases we make are done through them since they represent a good replacement of cash. However, if they are not used wisely, the purchases you make may spiral out of our control and we may end up in deep debt. The corresponding interest rates, penalties and fees may further your condition.
However, you can easily avoid this commonly experienced scenario. If you are already in debt, you can take this advice to get out of it.
Prioritize your credit card debts.
First, make a clear view on the amount you owe by carefully examining the bills you receive with your mail. After this look at the interest rates that you are charged on the credit cards you possess. Order them according to the amount of interest rate you pay from the highest to the lowest rate.
The cards with the highest interest rates are those with the highest priority. They are the ones that cost you more over the long-term so you should cover their debt first. Start making more than the minimum payment every month for them. Research on the available opportunities, which are both time and money efficient, for paying back your balances in these cards.
Negotiate for a better credit card plan.
Here you can use a small trick. You can call the customer service of your credit card company and ask for a lower interest rate. You can tell them that you are receiving better offers in terms of interest rates from other companies and you are seriously considering them. They most probably will not like to lose you as a client and the representative of the company will do his/her best to offer you a better deal. If you manage to arrange it, your minimum payment will decrease. However, you should continue to pay the old amount so that you sooner get rid of the accumulated debt.
Research the available credit card offers.
The competition in the credit card field has led to some companies offering significantly lower interest rates. Examine some of these and consider the transference of your balance. You will be positively surprised how much you can save on interest rates if you execute this transaction. However, don't do this without making any analysis, because most of the interest rate attractive credit cards have some hidden traps that may end you up in paying more than the previous amount.
Improve your credit score.
When lenders and creditors decide on the amount of interest rate you will be charged they consider the value of your credit score. It reflects your credit worthiness. Late payments and maxing out your credit cards have a negative effect on your credit card score. You can get information on your credit card score from the credit bureaus. Since they calculate it on the basis of the payments you have made over the last six months, you will need to work hard on them so that you improve it.
Final Piece of Advice
In order not to get in further credit you should avoid incurring any fees or penalties. They are usually charged when you make a late payment by not sticking to the due dates. Additionally, you should watch out for not going above your credit limit, otherwise you may be charged a credit limit fee.
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