Most of us probably can’t imagine how our lives would be without credit cards. The tiny piece of plastic has become an essential part of our lives that we just do not know how to live without it. This kind of lifestyle is also what causes the credit card debt rate in the United States to be sky high. The concept of moderate living eludes most of us and that is why we always tend to swipe our cards more often than we can actually afford to. This results in a credit card debt trend that is worrying enough not just for individuals but for the nation as well.

If your credit card bills are overwhelmingly high and you are aware that there is no way you can afford to pay your bills on your salary, you are probably in need of a credit card debt program settlement. You don’t have to do this all by yourself if you think you don’t have the expertise or the adequate knowledge to handle this issue. You can always engage a professional third party to assist you in managing your credit card debts as well as act as a liaison between you and your creditors.

By working towards a credit card debt program settlement, you will not only be able to pay off your credit cards systematically and consistently but you will also be able to learn more about your spending habit. Your credit consultant might be able to advise you on what you should and should not do but the power of choice is in your hands. Only you can make the necessary changes to ensure that you won’t end up being knee deep in debt twice in a lifetime.

Be realistic in your expectations as well because credit debt settlement is not a miracle solution that will make all your debts go away in the blink of an eye. The procedures alone could take months or even years; depending on the severity of your particular case. You or your appointed credit counselor most probably will have to pay quite a number of visits to your creditors before an initial stage of discussion can even take place. But you don’t have to worry as most creditors do not like to lose all of their money. So instead of letting you file for bankruptcy, in which case they will never get their money back, they will most likely be willing to give you a debt reduction. Consider it as a discount on their part.

Your creditors are not going to be the one to initiate the discussion on the acceptable percentage of reduction of your debts. So you or your appointed credit counselor is going to have to conduct extensive research and discussions from which your creditors will evaluate and make a decision. You probably need to show your creditors that you are serious about paying them the money you owe. You and your credit counselor will negotiate with your creditors on the debt reduction amount, sometimes up to 50%.

Once a reduction rate is agreed upon, your counselor will then negotiate to get your creditor to allow you to pay the reduced debt in monthly installments. Your creditors might agree to it but there are instances where they will insist that you pay them in lump sum. If that is the case, you may opt to take a personal loan at a lower interest rate to pay your creditors and subsequently start paying off the loan in monthly installments as per your counselor’s advice. Be sure you are consistent in making payments or else you will only end up accumulating more new debts.

You might also want to consider not only to clear credit card debt but to stay away from it too. Start living your life within your means. Simply put, if you don’t have the cash for it, you can’t afford it. It might take some getting used to it initially but in the long run, you will not only be financially free but you could actually catch up on your savings for the future.

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Category: Finances
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