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4 Ways to Get Out of Credit Card Debt

Managing finance is not any easy job. Most people do not possess the knack for money management, and end up spending more than their budget. Credit card holders especially fall into debt easily when they exhibit such behavior. Debt can be devastating and must be avoided at all costs.

But if you have come under credit card debt, you need effective and practical debt relief advice.  If you are looking for debt relief advice, you have come to the right place. This article will guide you in effective and realistic methods of managing credit card debt.

Balance Transfers

Balance transfer means that you can transfer your existing debt to another credit card with lower interest rates, and make only one monthly payment to settle the debt. Moreover, you only have to pay off the outstanding amount on one credit card per month rather than several of them. To use this option, you firstly have to record and list down the total debt you owe to the bank for each credit card.

Determine which cards have lower interest rates. When you list this information down on paper, you will be in a better position to communicate with the credit card company. Also list down the name of each company, as well as your account number. After these preliminaries, you have to call the company to which your balance will be transferred.

You will have to communicate with the customer service operators, who will ask you to provide and verify all the essential data.

You will be asked some questions based on which you will be able to transfer your balance successfully. After these procedures, the company will take care of the actual balance transfer. You will not have to call each company individually.

Once the procedure is complete, you will be informed both through telephone calls and written data that the balance transfer is complete. Both the transferring company and the company to which the balance has been transferred will provide confirmation. You only have to pay the amount.  In summary, you can make the most of your balance transfers to relieve your debt by taking advantage of the lower interest rates.

There are, however, other methods as well through which you can manage your debt in a suitable way.

Negotiation

Negotiating with the creditors can really prove to be beneficial. If you have a good credit history and you make your payments on time, you can use this reputation to ask creditors for lower monthly interests. Write down the debt you owe to each company, and then determine the highest amount you can pay at the given time.

Inform the creditors about this arrangement, or consult the superiors in the company. Since you are in a weaker position here, do not argue or grow impatient. And most importantly, never make the payments unless you have a written agreement with the concerned party.

Debt Consolidation

This is another way of achieving lower interest rates on your credit card payments. You have to calculate the average amount of interest you have to pay each month, and then look for a loan (such as home equity) with lower interest rates to pay off your debt.

Use this method with caution, as it requires further borrowing. Some loans offer lower interest rates, but the repayment period is long. You may end up making more payments than your original debt! So choose wisely.

Bankruptcy

This is the last option to settle your debt, usually when the amount exceeds your capabilities. However, this is not an easy way out for everyone who borrows. Laws have become strict, making it difficult to file bankruptcy until you meet a certain criteria. Comparisons will be made thoroughly of your income and your present debt, and then it will be determined whether you can declare bankruptcy or not.

Debt Relief Advice

There are various methods of managing your debt. However, it is better to analyze the factors that led to the adverse situation. Seek professional counseling. You can easily find debt relief advice for free. Counselors will not only teach you ways of settling your debt, they will also guide you in effective spending and saving habits.

About the Author:

The above article is written by Roxanne Peterson

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