Credit Card Debt Advice - Find the Right Solution for You
Any type of debt can become unmanageable if circumstances change.
However, if there is one form of unsecured debt that causes more problems than any other, it's credit card debt.
In fact, many of us, when asked about our debts, don't even consider credit cards to be a debt - we consider it to be 'credit' that is available to us should we need to use it! Credit cards are what is known as expensive credit, they have a very high interest rate.
The problem is that historically, they were only ever meant to be used for smaller levels of borrowing, certainly not the £5,000 to £10,000 levels we see per card today.
In fact, if you were paying back £100 per month on a typical £5,000k credit card debt, it wouldn't even be enough to cover the interest for that month, which means late payment charges, more interest and a debt spiralling out of control.
Fortunately, there are a number of options available to someone that is struggling with credit card debt.
At one of the scale, if you have smaller, manageable credit card debts but would appreciate a bit of short-term breathing space to pay back more capital, you can always look for a zero percent balance transfer.
These deals, which have become increasingly scare over recent months due to the global economic downturn, freeze interest on any funds transferred from one card to another for an agreed period of time.
Over this period of time, any payments you make go towards the amount you owe rather than the interest.
If however, you have larger debts that will continue to be unserviceable after the interest free-period has ended, then this is not an option for you.
You are simply delaying the inevitable.
In these circumstances, you will need to take credit card debt advice from a professional debt advisor, who will be able to consider all of the options available to you.
This might be a Debt Relief Order if you have less than £15,000 of unsecured debt and less than £50 available to pay to your creditors each month after essential expenditure (living costs) has been taken into account, an IVA if you owe more than £15,000 and are able to repay some of your debt back or Bankruptcy, if realistically, you have nothing left over at the end of the month to offer to your creditors.
Whatever you do, don't bury your head in the sand and hope it will all go away!
However, if there is one form of unsecured debt that causes more problems than any other, it's credit card debt.
In fact, many of us, when asked about our debts, don't even consider credit cards to be a debt - we consider it to be 'credit' that is available to us should we need to use it! Credit cards are what is known as expensive credit, they have a very high interest rate.
The problem is that historically, they were only ever meant to be used for smaller levels of borrowing, certainly not the £5,000 to £10,000 levels we see per card today.
In fact, if you were paying back £100 per month on a typical £5,000k credit card debt, it wouldn't even be enough to cover the interest for that month, which means late payment charges, more interest and a debt spiralling out of control.
Fortunately, there are a number of options available to someone that is struggling with credit card debt.
At one of the scale, if you have smaller, manageable credit card debts but would appreciate a bit of short-term breathing space to pay back more capital, you can always look for a zero percent balance transfer.
These deals, which have become increasingly scare over recent months due to the global economic downturn, freeze interest on any funds transferred from one card to another for an agreed period of time.
Over this period of time, any payments you make go towards the amount you owe rather than the interest.
If however, you have larger debts that will continue to be unserviceable after the interest free-period has ended, then this is not an option for you.
You are simply delaying the inevitable.
In these circumstances, you will need to take credit card debt advice from a professional debt advisor, who will be able to consider all of the options available to you.
This might be a Debt Relief Order if you have less than £15,000 of unsecured debt and less than £50 available to pay to your creditors each month after essential expenditure (living costs) has been taken into account, an IVA if you owe more than £15,000 and are able to repay some of your debt back or Bankruptcy, if realistically, you have nothing left over at the end of the month to offer to your creditors.
Whatever you do, don't bury your head in the sand and hope it will all go away!
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