Credit Card Relief through Credit Card Debt Settlement

Before I discuss how to go through credit card relief by means of credit card debt settlement, I will first discuss the various causes why people find themselves having credit card debt problems.

The MAIN CAUSE of credit card debt problems is --> PAYING ONLY THE MINIMUM AMOUNT DUE in your credit card billing statement.

The cause stated above is the biggest culprit of all credit card debt headaches.

LET ME ILLUSTRATE (assumed interest rate is 3.5% per month and you pay only the 5% minimum amount due at the end of the month).

As you can see in the above table, you only purchased a total of 12,500.00, but since you only pay the 5% minimum amount due from your card balance after month end, you still have a card balance of 8,729.07 after the end of the 24th month. Which means only 3,770.93 was applied to your principal or your purchases, despite having paid a total of 12,569.77 because 8,798.84 was applied to interest payments of 3.5% every month.

An individual trapped in a credit card burden (some call it credit card debt prison) should resolve with all his will to escape from such burden.

Why?

Because a credit card debt burden may cause a strain in individual or family budget, it could lead to broken families in some instances. A couple of months ago, in the news was a story of a woman who was left by his husband due to her uncontrolled credit card spending which led to severe strain in their family finances.

A credit card burden could also result to less and less money available for your monthly budget. One day you will find yourself in a situation where the only amount you can afford to pay is the minimum amount due and you will find yourself in situation much like what is shown in the above table.

What to do?

The FIRST THING TO DO IS -----> CUT your CREDIT CARD! This way you can no longer use it. And do not use it too for online purchases because even if your card is cut you can still purchase online.

What are your options after you cut your card?

One and only option I recommend ---> Apply for credit card debt settlement.

Call the issuing bank of your card and tell them honestly about your situation. Negotiate with them that they close your card account (this is important in order for you not to use the card even for online purchases) and that its balance be converted to term loan and that you be given a fixed amount monthly and fixed term for you to finish paying your credit card debt.

Then, if you have successfully negotiated with them, ensure that you pay every dollar and cent in your monthly amortization until you have completed the fixed term, for example 36 months or 3 years. After three years you will then be free of credit card debt.

Do not apply for a credit card again!

This method is another option used by those trapped in a credit card debt burden. This is similar in form as to payment of amortization to a credit card debt settlement.

The only difference is that instead of going to the bank that issued your card, you apply for another credit card with another card and transfer your balance. You will then be given a fixed amount of monthly amortization which will allow you to finish paying the transferred balance in a fixed term.

Using this mode of getting rid of credit card debt is risky for people who have no discipline. It may result to continued use of the original card whose balance had been paid out through the balance transfer and bringing you into a situation where you are paying for amortization of your new card and new credit balance on the old card. And worst than that, you have also utilized your new card thus, you need to pay for amortization of the transferred balance, new purchases on the new card and new purchases on the old card.

Therefore, applying for a credit card settlement with the old card's bank is the major option if you want to get rid of credit card debt.

After you get out of your credit card burden, you should discipline yourself and learn budgeting skills in order not to put yourself again in a financial mess. Watch the video below and learn the envelop method of budgeting.  The envelop method have been used by the most successful people in terms of financial management.

If you are already deep in debt because of your credit cards, you can still use a modified envelope money management system. See another video below.

Act NOW! And be debt free, discipline is all it takes!