Credit card debt is common today and the reason is easy availability of debtor and misuse of credit card. It’s an unsecured debt that results when consumer do not pay on time for any purchase or service, he had utilized via credit card. Late payment and penalty including accumulating interest rate creates trouble in life of card holder. When consumer do not pay bill on time Credit Card Company informs to the credit agencies and they mark the consumer’s account defaulter. This kind of practice harm credit score of consumer and his financial future seems to be in danger.
There are many option to cover credit card debt most common being self-assistant options. In this consumer try to cover up all credit bill by himself. Often customer tries to utilize the first quarter of the year to overcome major portion of debt amount. This is the time when consumers are offered many offers and discount schemes as well as they get holiday packages and tax refund. All this money can be utilized to cover major portion of credit card debt. Account holder can take another smart move by lowering annual percentage rate which will save a lot of money. Recession scemes offers credit card debt relief options. Cut off further use of credit card is mandatory if you are working to repair your credit.
If anyone finds himself unable to manage credit card debt on their own, they can go for other debt settlement options such as debt settlement, debt consolidation, credit counselling or bankruptcy. Bankruptcy is harmful for both creditor and debtor. By filing bankruptcy, creditor may get 75% relief of debt amount but he loses his credit score for seven years.
By agreeing a consumer for bankruptcy debtor finds himself totally in loss because he gets only 1/3 portion of debuted money. Many credit card companies opt federal law path and urge not to cancel any credit card debt. In such situation they offer consumer other options. They request creditor only to pay actual used amount and pardon their late fee and interest rate.
There is a different option for credit card debt relief which is known as debt consolidation. Debt consolidation is the process in which consolidator takes easy monthly payment from creditor. He keeps his minimal fees and rest money he forward to debtor. Actually you are paying your debt, just a mediator is there between debtor and creditor. This mediator manages your finances which were out of your control.
There are some common objections regarding debt settlement process, lost credit is one of them. Although debtor settles his account and gets full payment after debt settlement, yet there is clear reference in documents that debt is settled with the help of Settlement Company. This obviously damage credit of both for a long period of time. Due to the major default found in lawsuit many credit card company push borrowers to file bankruptcy. Even after clearing all debt creditor can sue a debtor in court.
Another drawback of debt settlement is if creditor file for bankruptcy law announce that forbidden debt amount as refundable tax. For such refund process creditor must have tax reduction form. All options are available for one who determines to vanish debts from his life. It is just you have to be sure that you want to have a debt free life and work on it wisely. Research well and look for options by which you can get freedom from all your debts and you can have a debt free life.
Consolidate credit cards if you are using too many cards and are struggling with debt issues. It is easy and effective if you research well and go for it in a wise manner. It will surely provide you credit card debt relief and you can have a stress free life. Plan well and then go for it and make your life stress free and happy.