Options for Credit Card Debt Elimination
Credit card debt is becoming more common as people rely on credit, rather than money on hand, to pay for things. Doing this often leads to out of control debt, but there are several ways to get back on financial track.
– Balance Transfers
If you have a credit card with a low interest rate, you can move your balances from other cards to the low interest credit card. This form of credit consolidation allows you to pay off debt at a lower interest rate and reduces your monthly payments to one.
– Credit Unions
By taking out a non secured loan with a credit union, you are able to pay back your credit card debt in one lump sum, and at a lower interest rate.
– Credit Counseling
This form of credit consolidation allows a third party to work on your behalf to lower interest rates and total debt with creditors. There is usually a fee associated with credit counseling.
– Renegotiate
You can work with your creditors to lower your interest rates and the amount of debt you owe to them. Since most credit card companies get almost nothing back if they do not work with you, many will negotiate with you.
– Retirement Funds
The advantage of taking money out of retirement funds is that the IRS will not start taxing you on the borrowed sum for five years; however, if you lose your job or quit, the money you borrowed is due back into the retirement account immediately.
– Life Insurance policies
There are almost no down sides to borrowing against a life insurance policy because you are not required to pay it back in a certain amount of time. That said, the money will not be paid to your dependants if it is not returned to the life insurance policy.
– Home Equity Loans
When you have value built up in your home through equity, you can borrow against that equity to pay off credit card debt. Be careful if you chose this method because even if your mortgage is current, if your equity loan becomes past due, you can still lose your house.
– Relatives & Friends
While this is known to be a bad idea, if the difference between bankruptcy and keeping up with your debt is borrowing money from friends and family, you may want to consider asking for a personal loan.
Article Source: http://www.articlefield.com
Processing your request, Please wait....
