December 22, 2009
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News: Start Your Year Off Right; Eliminate Debt
In just a few short weeks, those dreaded credit card bills will be showing up online or in the mailbox. You may have spent more than you expected and could find yourself buried in that holiday shopping credit card debt; a new year and a new mess. Have you considered how you'll get out from under it? Some may say the answer is to seek relief through the courts by filing bankruptcy. However, bankruptcy has some serious repercussions. Not only does it leave a nasty mark on your credit report for a very long time, it doesn't guarantee protection against all debt. The black mark on your credit will prevent you from obtaining credit cards and loans for years.
There are, however, a few things that you can do to help you reduce your debt, protect your assets, and live a healthier financial life. Begin by contacting your credit card company and asking them to negotiate a lower balance or interest terms. You will most likely be required to shut the account down to future use, but the payoff is well worth it. Agreeing to such terms allows you to pay down debt years earlier. Some credit card companies will even consider cutting your debt by 50 or 60 percent if you agree to pay the balance in one lump sum.
Debt consolidation is another option. With debt consolidation, you are able to pay off all your other high interest credit cards and loan debt by combining them into one easy monthly payment. A word of caution; thoroughly check out any debt consolidation company out before signing anything. Use a reputable lending institution and consider all the options available in advance of resorting to this. There are some reputable credit counseling agencies available to you as well for little or no fee. Under no circumstances should you hand over any money to any counseling or negotiations firms. To find a reputable firm visit the National Foundation for Credit Counseling (NFCC) website at http://www.nfcc.org/.