About Debt - Credit Card Debts

Credit Card Debts

Are your credit card debts sky high? You want to pay them off, but there's no end in sight! But don't worry--there are a lot of programs out there designed to help you eliminate credit card debts. There is a light at the end of the tunnel. There is hope.

Ways to Get Rid of Credit Card Debts

Finding relief from credit card debts is like finding a needle in a haystack if you don't know what you're doing. There are at least four different ways to eliminate credit card debt, and none of them involve bankruptcy. You can consolidate credit card debts with debt consolidation, pay off your credit card debts with a debt consolidation loan or a debt consolidation mortgage, or settle credit card debts through a debt settlement program. Here's a brief explanation of these programs:

Debt consolidation uses negotiation to get your creditors to lower the balances and interest rates on your credit card debts . This is done by a debt consolidation company. Once your balances and interest rates are lowered, they're all combined into one, and you make one monthly payment (at a reduced interest rate) to the debt consolidation company instead of several monthly payments to your creditors, and you can be debt free in about five years.

A debt consolidation loan is a loan given to you to pay off unsecured debts, the most common of which arecredit card debts. You pay off all of your credit card debt at one time, then you make monthly loan payments to the debt consolidation company. Because the interest rate is so much lower, this enables you to pay off the loan in about five years. This type of loan usually requires some kind of collateral in case of default, so if you don't have collateral, chances are you can't get the loan. If that's the case, one of the other debt consolidation programs listed here might work better for you.

A debt consolidation mortgage allows you to borrow from the equity in your house to pay off your credit card debt or other unsecured debt. Your loan payment is tied in to your mortgage payment, so you get the same low interest rate as your mortgage. It will be paid off when your house is paid off. But be careful--if you miss payments you could lose your house.

Finally, there's debt settlement. When you enroll in a debt settlement program, a debt settlement professional will contact your creditors and negotiate a deal that allows you to pay off your debt at 30-50 cents on the dollar? The catch? You have to pay it off almost immediately (although there are some companies that will let you extend it from 1-3 years). Also, it leaves a slight "blip" on your credit report, similar to late payments.

Hopefully one of these programs will provide you with your ultimate credit card debt solution.

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