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How To Get Help With Credit Card Debt

Customized Debt Consolidation Loans

Where to go to get help with credit card debt

Here at National Debt Relief, we know everyones financial situation is different and thats why we customize every debt consolidation loan program. We pride ourselves on offering a program that isnt one size fits all. Instead, we take the time to analyze your specific financial needs and prepare a personalized debt consolidation loan quote that will lay out exactly how much you can expect to save.

How To Negotiate Credit Card Debt

Quick Answer

If you’re behind on your credit card payments, it’s possible to negotiate the amount you owe. You can negotiate your credit card debt through forbearance, a workout agreement, a debt management plan or debt settlement.

In this article:

Before you call, though, add up your debt, review your options and understand the potential risks. Here are some steps you can take to negotiate your credit card debt and some of the issues that can arise regardless of the outcome.

Access Your Court Records In

Going to the courthouse to get your documents is an option if you live within minutes of the courthouse or prefer talking to the court clerk face-to-face for additional help. The first step is to find out the court’s location using this Pennsylvania courts directory. Hover over the map until you find your county, and click on it. Youll be redirected to a page containing the contact information for the courthouse, including the physical address.

At the courthouse, you’ll be asked to fill out a written request giving vital information that will be used to locate the records in the system. Some courthouses provide self-service terminals for individuals to search the record. You may be charged a small fee for the services provided.

Lets explore an example.

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Balance Transfer Credit Card

If your credit is in good shape, another option might be to apply for a balance transfer credit card. These cards typically come with a low or 0% APR for a set period of time, with some promotions offering an interest-free period of a year or longer.

During the introductory period, you pay no interest on the balance you transfer from another credit card, although you could pay a transfer fee that’s typically 3% or 5% of the amount you transfer.

If you’re able to pay off the entire balance by the end of the introductory period, you can avoid paying any interest charges. And even if you can’t completely pay it off in time, pay as much as possible every month toward the balance and you could still save yourself hundreds of dollars.

If you have multiple balances, consolidating them with a balance transfer can also simplify your monthly payments.

However, it’s important to understand the limitations of balance transfers. The promotional APR is often only for the amount you transfer, and a higher interest rate may apply to any new charges you make using that card. Some promotional offers do include both balance transfers and purchases, so review the terms carefully.

Finally, keep in mind that a late or missed payment may cause you to lose the introductory rate, and after the introductory period ends, the interest rate on the unpaid balance can jump significantly.

How To Determine If You Should Negotiate Your Debt

Complete Guide To Getting Help With Credit Card Debt

If you have credit card debt that you are looking to settle with the credit card company, consider a few factors first. First, explore other options like credit counseling or bankruptcy. Either of those may be a better fit for your specific situation.

If you are not already several months behind in your payments, the credit card company may not be willing to enter into debt negotiation, so you might need to consider other options. The credit card company will also want to make sure that you have the financial ability to pay any settlement. This could be a lump sum or enough monthly cash flow to fulfill your settlement obligations.

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Debt Settlement: How It Works And Risks You Face

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Debt settlement means a creditor has agreed to accept less than the amount you owe as full payment. Once it accepts that deal, the creditor cant continue to hound you for the money and you dont have to worry that you could get sued over that particular debt.

It sounds like a good deal, but debt settlement can be risky:

  • Debt settlement can destroy your credit.

  • Reaching a settlement can take a long time to accomplish often between two to four years.

  • It can be costly.

Even if you are successful at debt settlement, it can take years and you may discover you owe tax on any forgiven debt. And if you use a debt settlement company, youll pay fees. It is a last resort.

Cultivate A Healthy Credit Lifestyle

Often, we drive ourselves to learn about credit only when we realize we have credit problems. As you look to pay off your credit card debt, you can begin to understand the best ways to sustain a healthy and affordable credit lifestyle. This can help you avoid a credit crisis, but it can also drive your credit score higher so you can obtain attractive terms for the loan or line of credit that you may need in your future.

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Grow Your Emergency Fund

If youre one of the many Americans who dont have significant savings, overusing credit cards is an easy trap to fall into especially if its not possible to borrow from friends or family or cut back on spending.

You have to build your savings first before concentrating on debt, says Steve Repak, a certified financial planner and the author of 6 Week Money Challenge.

He suggests building your short-term savings to at least $500 while making only the minimum payments on your existing credit cards before you start concentrating on your debts. That way, you can tap your savings instead of swiping your credit card if you have an unexpected expense.

For consumers that have debt and their income isnt high enough to save anything, they either have to reduce expenditures or increase their income, and the best-case scenario would to do both, Repak says. Supplementing your living expenses using credit cards cannot be a solution.

  • Who this strategy is good for: Anyone lacking a significant emergency fund

Learn About The Types Of Personal Bankruptcy

How Do I Tackle My $13,000 Credit Card Debt?

Federal courts have jurisdiction over all bankruptcy laws, so you must file a petition in a federal bankruptcy court. There are two main types of personal bankruptcy:

  • Chapter 13 lets people with a steady income keep their property. This bankruptcy plan allows filers to keep a mortgaged house or car they might otherwise lose in the bankruptcy process.
  • Chapter 7 is known as straight bankruptcy. It involves liquidating all assets that are not exempt under federal or state law.

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Financial Help For Women And Families

Single parenting can add to the challenges of a low-income household. Financial help for single parents is available through:

  • WIC Provides supplemental food and more to low-income pregnant women and mothers, as well as children up to age 5
  • CHIP The Childrens Health Insurance Program provides low-cost health coverage to children in families that earn too much money to qualify for Medicaid.
  • TANF Temporary Assistance for Needy Families provides immediate help for necessities like housing and food.

Use Credit Card Debt And Interest Calculators

Try to find an app that offers a credit card debt calculator. It can help you uncover exactly how much you owe and how long it might take to pay it off. You could also look into a . This helps you better understand how interest impacts your total credit card balance. If youre like most, you might be surprised to learn how much interest actually costs.

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How To Settle Credit Card Debt

Enrolling in a debt settlement program to lessen credit card balances can be helpful, but make sure to do your research. You are hoping to settle debt and this involves spending your money to pay down your debt and companies will also need to get paid for their time and negotiations. If you are concerned with a debt settlement company, check out the company with your state Attorney General and local consumer protection agency. National Debt Relief is in good standing with the BBB and our customers have positive experiences they have shared on Trustpilot.

Debt settlement is an agreement between a lender and a borrower for a large, one-time payment toward an existing balance in return for the forgiveness of the remaining debt. Someone who owes $10,000 on a single credit card, for example, may approach the credit card company and offer to pay $5,000. In return for this one-time payment, the credit card company agrees to forgive or erase the remaining $5,000 still owed.

Some options when you want to settle your credit card debt are:

Option : Enroll In A Debt Management Program Through A Credit Counseling Agency

Help with credit card debt

The benefit of professional help: A debt management program is the solution you use if you cant make progress on your own. If you dont have good credit or youve missed some payments, your creditors may be resistant to working with you. Having the help of a credit counseling agency means you have a team advocating with creditors on your behalf. That makes it easier to craft a repayment plan that your creditors will actually accept.

How It Works:

  • First, you talk to a certified credit counselor to review all your options. The counselor makes sure a debt management program is the right solution otherwise, they can direct you on where to go.
  • If debt management is the right choice, they can help you enroll. Together, you find a monthly payment that works for your budget.
  • Then the counselor calls each of your creditors to get them to sign off on the adjusted repayment schedule.
  • They also work with creditors to reduce or eliminate interest charges, as well as to stop future penalties.
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    Check Your Credit Reports Regularly

    You can typically check your credit reports for free, once a year. However, the three major credit reporting agencies Experian, TransUnion and Equifax are currently allowing consumers to check their reports weekly for free.

    If you sign-up for a credit card relief package and are meeting the terms of that relief package, such as making a lower minimum payment, the company must report to the credit reporting agencies that you are current on the account. However, if you were already behind on your payments at the time you receive relief, the lender is not required to report that you are current.

    And, if you find an error, you should work to dispute it, this is when it would be helpful to have a copy of the written agreement on hand.

    What Debt Settlement Options Are Available

    Getting help with your credit card debt settlement isnt free. Consider the time and frustration you could endure with trying to fix your credit issues on your own.

    When you do business with a debt settlement company, you will have to show that you have the money to pay down the debt. Some companies may ask for a dedicated bank account, which the money then will be sent by an independent third party. The funds are still yours and if its an interest bearing account, you will be entitled to this.

    A reasonable fee for account maintenance may be added on. This could include transferring the funds from your account to pay your creditors and the debt settlement company when settlements occur.

    A credit card debt settlement company can charge you only a portion of its full fee for each debt it settles. For example, you owe money to three creditors and the settlement negotiation is only successful with one of your creditors. For every successful debt settlement, the company can charge you another portion of its full fee.

    A common approach is if the companys fees are based on a percentage of the amount you save through the settlement, then the company must tell you both the percentage it charges and the estimated dollar amount it represents. This may be called a contingency fee.

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    Check If Your Credit Card Company Broke The Rules When You Applied

    If the company didn’t follow the rules when you first applied, they might have to cancel or ‘write off’ your debt. This might happen if for example:

    • they didnt check you could afford the repayments

    • you were pressured into signing a credit agreement

    • you didnt understand what you were signing

    If you think your credit company broke any of these rules, you should talk to an adviser.

    Commit To A Monthly Payment Amount

    How to get out of Credit Card debt WITHOUT Paying Interest!

    For this tip, you’ll need to know your take-home pay and your monthly fixed costs, meaning your necessities. Add up all the bills you have to pay, and then subtract them from your take-home pay. Based on what’s left over, you can decide on how much you’ll pay toward your credit card debt every month.

    Let’s say your take-home pay is $4,000 per month, and your fixed costs are $2,500. That leaves $1,500. Knowing that, you could commit to paying $750 or $1,000 per month toward your credit card debt. Leave yourself some wiggle room here. It’s important to set a realistic goal you can reach every month.

    What’s important is committing to a specific amount. By doing this, you’re more likely to stay on track and be consistent.

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    Next Steps: Find The Relief Thats Right For You

    If youre struggling with credit card debt and arent sure what tactic will bring you the most relief, its worth considering talking to a nonprofit credit counselor. A reputable credit counseling organization may be able to help you understand your options and develop a plan to manage your finances and pay off debt.

    Make Your Minimum Payment If Possible

    This may be difficult guidance if youve lost your income and youre having to prioritize your bills. There may be cases, though, where you get financial assistance from your credit card companies, but your interest continues to accrue. If this is the case, making the minimum paymentand making it on timecould help ease the burden later on.

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    Using The Snowball Method To Pay Off Credit Card Debt

    The snowball method targets the credit card that has the smallest current balance. While you assign the minimum payment to all other credit cards, you use every bit of your available budget every month to pay off the credit card that has the smallest overall debt.

    Once you have completely paid off your credit card with the smallest balance, you take that same monthly budget and apply it in addition to the monthly minimum payment to the credit card with the next smallest balance

    Picking A Method To Pay Off Your Credit Card Debt

    5 Tips To Help Tackle Credit Card Debt

    Both the snowball method and the avalanche method have been proven to be effective ways to reduce credit card debt.

    Proponents of the snowball method suggest that working on a smaller balance allows you to develop habits that promote credit card health while creating a goal that can be quickly completed.

    Avalanche method supporters contend that building a budget that works against your highest APR card is more financially advantageous, as you are immediately reducing the debt that produces your largest bills.

    Either method can combat your credit card debt, provided you have a full understanding of all of your credit card’s balances. You can also use both debt reduction methods by switching between paying off smaller balances then shifting to cards with high APRs: as best matches your available budget and motivations.

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    Get A Written Copy Of Your Agreement

    If you choose to move forward with a financial relief option, its important to understand the terms of the agreement before agreeing to anything. Once youve accepted a relief option, make sure to get a copy of the agreement in writing.

    During the relief period, you want to make sure to look at your statement each month for any errors or inaccuracies, and if you see anything, make sure to refer back to the agreement so you can dispute it.

    If You Can Only Afford The Minimum Repayment

    You should keep paying the minimum amount as youll avoid paying fees – but you will be charged interest.

    If you dont think your situation is likely to change, you might be able to:

    • move the debt to another card that charges less interest – this is called a balance transfer

    • get a loan that charges less interest than your credit card

    Compare the cards or loans you can get from different companies. Think about:

    • if there will be a fee to move your balance to another card

    • what interest and charges youll pay on the new card or loan

    • the length of any interest free period

    Only use a loan or new card to help pay off the debt you already have. Don’t spend any more on your existing credit card.

    If you get a loan, dont get a loan thats linked to your home – like a mortgage. You might lose your home if you cant pay it back.

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