People with credit card debts habitually bury their heads in the sand. Frighteningly, some are simply lost in the jungle of their financial destiny and don't know how to deal with the monetary trouble. Let us take this one step at a time and undergo with the first step which is an honest self-assessment.
Bring together all the credit card statements and find out the total outstanding amounts you owe from all these cards. The last thing you do not want as a surprise in dealing with this mess is your total amount to pay. This will set a mark for the challenge you have to hurdle and will make things more realistic.
One of the best ways to get rid of credit card debts is with taking advantage of loan consolidations. If you happen to own four or more credit cards and are having late payments, give up two to three cards and maintain just your favorite credit card. Unless you give up these credit cards, the consolidation loan may not be an option for you.
But if you happen to have already a hard time paying the credit card bills on time each due date, this is definitely the best choice. Sacrificing the rest of your cards is one great way to avoid your credit rating from having a negative impact with the banks because of missed payments.
Consolidating your various credit card debts into one big loan will facilitate the escape from those high interest rates normally charged by your credit card lenders. You will likely have a more organized payment scheme because you will only be making one payment. Instead of paying numerous payments each month with different due dates, you will only handle one big payment from the consolidated loan and will definitely avoid making late payments which results in extra charges and fees. This is the most effective way to get rid of much stress in your financial life and focus on the debt payment as a whole.
Explore with the different banks you currently do business with and talk about the debt consolidation loans they are offering. Evaluate consolidation loans with other lenders and get the lowest possible interest rate with the best terms.
Try negotiating with the banks if you have already a relationship with them and discuss a debt consolidation loan that will suit your needs and will most likely help you with the situation. By learning from this financial mishap, never allow yourself to incur the same situation in the near future.
By paying off your credit cards, you'll be shocked at just how much money you will save. Between the interest, fees, and late charges, credit cards can suck up all your disposable income.
So make a commitment to paying off your credit card debt as soon as possible. To help you get started, I've put together this list of the top 5 ways you can eliminate credit card debt.
1. Stop charging and reduce credit card debt!
This might sound simple, but it's amazing how many people just can't seem to get themselves to put away their credit cards. Force yourself to do so. If you can't pay for it in cash (or with your debit card), then don't buy it. Period. Once you stop digging yourself in deeper, you can finally start to get out of that hole once and for all and begin the process of credit card debt elimination.
2. Get your current credit card interest rate reduced
Once you have stopped adding to your debt, the next step is to get lower interest rates. Did you know that most credit card companies will put increase your interest rate by as much as 100% if you so much as make one late payment? Even if payment is just one day late, the banks will often drastically raise your interest rate. The really silly part is that these companies rarely report you to credit bureaus unless you are a full 60 days late with a payment. So while they might have raised your interest rate, your credit score could well remain unscathed.
You can easily work this situation to your advantage. If you find that your bank has raised your interest rate, call or write them, telling them you have another bank that is willing to give you a much lower rate - after all, you still have a good credit rating. See if they call your bluff - odds are, they won't, because they know there are many lower rates available. This is a great way to save big bucks in interest each and every month without even opening up a new credit card.
3. Apply for New Credit Cards
Of course, if your bank won't deal with you, search for another bank offering lower interest credit cards, and open an account with them. Remember, unless you've been over 60 days late with a payment, your credit report might well have no marks on it from your old cards. Furthermore, even if you have a less than stellar credit score, there's a very good chance you can still find a lower rate than you currently have.
4. Utilize interest-free trials
When looking for a new credit card, find one with an interest-free trail period. Some offer a year or more with no interest on balance transfers and new purchases. If your new card offers the latter, use it to make those new purchases - but make sure you put away money to pay off the balance before the trail period is up, and use any money you save on interest to pay off your pre-existing credit card debt.
5. Combine your credit card debts
Use balance transfers to move money from high-interest accounts to a new credit card with the zero-interest trial period. But make sure you check out how much the interest rate will be on the new card once the zero-interest trial period is up. Finally, always make sure you use any money you save on interest payments to pay down and eventually pay off your credit card debt. Do this religiously, and you'll be well on your way to a debt free life!
Both Paul Easton & Scott Russell are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.