Reducing Credit Card Debt – How to Reduce Credit Card Debt by Up to 60% Without Going Bankrupt
Reducing Credit Card Debt
If you are looking for a way to clear your debt you probably didn’t expect to find out that you can get it faster and without having to file for bankruptcy. In fact, there are a variety of ways to reduce credit card debt that do not involve resorting to insolvency but that can help you regain control of your financial situation and get your debt reduced.
As credit card debts are unsecured loans, they have a very high rate of interest and constitute a very large part of your loans especially if you are unable to pay them on time. This is very common in the situation especially since the economy is not performing well and people struggle with their jobs and finding new ones. With the constant threat of insolvency and the high rate of interest being charged, the loans become extremely large in no time and people struggle to even cover the minimum payments thus causing more complications as the debt grows.
In the process, there are a number of ways you can use to reduce your debt without having to go bankrupt. If you can afford to pay your monthly installments, that is a great way to achieve great results in debt reduction. The first method involves cutting back on your expenses; you can start by exercising a bit of self-control in buying things that you don’t need. You can buy stuff that are necessary by buying online, by renting a house or apartment, getting a cheaper car and so on. You can save money by not going out as much as you used to and by not really going to places that you don’t need to in order to have fun. You can also reduce the number of times you go to the shopping mall as you will want to stock yourself with necessary stuff instead of unnecessary stuff.
If your credit rating is poor, you might want to inform your creditors of this fact, so that they can help you in preparing a reasonable payment plan in the meantime. It can also be a challenge for your creditors to reduce your loan as they may not want to take any chances however in the long run, if they don’t settle for a lower amount or refuse you, you can threaten them by declaring insolvency and see if they are willing to lower your debt. This is Such a great and effective way to cut your loan by half and you should not be ashamed of doing it as you will just be saving money in the long run.
Sometimes the debt settlement company or some of its workers can offer you a better method in reducing your financial obligations thus making it easier to pay off the remainder. For instance, they can negotiate with the creditors and reduce your loan for about a fifty percent. Not only that, they can significantly decrease the rate at which the debt grows and this will allow you to finish making your payments in about three to five years.
However, there are bad things that you have to consider when you use such a procedure in order to make debt reduction. When you file for bankruptcy, you will find it very hard to find simple jobs, or if even if you find a position it will be on lower salary. This implies that your credit score will be very low for about ten years and this is the same thing you get when you use insolvency.
It is therefore best to use this as a last resort and not to resort to insolvency as it will have a lot negative effects.
