How to cut credit debt

Technorati Tags:
bankruptcy personal, bankruptcy loan personal, bankruptcy loan personal, bankruptcy filing personal

Most Americans have too much credit card debt. Duh, we've all heard that
before, right? Only now its gotten a bit personal... right again? You
personally have too much credit card debt and its about to drive you crazy.

Well there IS hope so don't file those bankruptcy papers just yet. One
major thing you have to keep in mind is your creditor is probably very
willing to work with you. Its in their best interest to have you making
some payment versus no payment. So here are a couple points to help
you deal with your credit card debt.

The first thing you have to do is simply contact your creditor and let them
know your situation. Ask for a lower interest rate or a repayment plan.
You might not have thought of it because you're just naturally so polite but
its a very good strategy to be courteous at all times when negotiating with
your creditor. Polite, but firm. Come across as one who knows what you're
asking for and expect to get it. If you're not sure what you're asking for
in the first place you might consider a reputable credit counseling service.
There's a lot of great, honest organizations out there whose mission is to
help you work things out with your creditors.

Next you've GOT to stop using your cards. Cut them up, freeze them in a tub
of water, whatever you need to do to get them out of your wallet or purse,
do it! You simply can't keep adding to the problem by running the debt up
any higher. This is actually one of the hardest parts of cutting your
credit card debt. Its like you're addicted to spending money you don't
have. So go cold turkey and drop the habit.

Start paying the ones with the highest interest rate first and work from
there. How do you do that? Concentrate on those high interest rate cards
by paying more than the minimum balance each month. The minimum is just
designed to keep you on the hook longer anyway. The credit card companies
are in this business to make a profit and want to have you paying them for
years to come. Even a little extra each month makes a big difference in the
long run.

Lastly, keep your chin up and have a good attitude. Millions of folks just
like you have begun to cut their credit card debt by following the common
sense steps outlined above. You can do it too.

Getting a credit card after bankruptcy

If you want to rent a car, reserve a hotel room or buy something
on the internet a credit card is almost a necessity today.

When it comes to applying for a credit card one question that a
lot of people seem to have is: Should I apply for a secured
credit card or unsecured credit card?

In case you don't know the difference, a secured credit card is
"secured" by a special savings account you establish with the
lender which acts as collateral for your credit limit.

For example, you deposit $500 in the special savings account and
then have a $500 credit limit. If you default, the credit card
issuer simply takes the money in your special savings account.

Unsecured credit cards are just that - unsecured. Meaning the
person fills out a credit application and, based on their credit
situation, they are approved for a certain credit limit. Of
course, they could also be declined depending on the credit card

issuer's guidelines.

So which is best? It depends on your credit history. However,
if you apply for a secured credit card you have a higher chance
of getting approved versus an unsecured credit card.

But be careful. Not all secured cards are created equal. And to
make matters worse, there are tons of banks out there pushing
secured credit cards!

So how do you choose? You can come up with a list of criteria
that the secured card needs to meet in order for you to consider
it.

When I'm researching secured cards, I apply eight criteria. Not
many meet these criteria so I'm able to narrow down the choices
quickly.

What are the some of the eight criteria? For example, a low
interest rate is important. While researching some secured
credit cards I ran across one with an interest rate of 23.99%
and another with an interest rate of only 9.25%.

This is just one of the criteria - and look at the potential
savings! Over several years you could save $100s or even $1,000s
in extra interest depending on the balance amount you maintain.

Okay, here's another criteria: application fees. Again, I found
some secured credit cards that have no application fees and one
that had a... are you ready for this... $120 application fee! Sadly,
people have paid it!

Let me give you one more criteria: You want to make sure the
secured card issuer reports to all three credit bureaus. But you
also want to make sure they report it a certain way.

I don't have room here for all eight criteria, but hopefully
this gives you an idea of some of the things you need to look at
when shopping for a secured card.

By the way, don't apply for too many credit cards at once. If
you do, it can hurt your credit score. That's why if you're
uncertain as to whether or not you'd be approved for an

unsecured credit card it may be better to apply for a secured

credit card.

Technorati Tags:
bankruptcy personal, bankruptcy loan personal, bankruptcy loan personal, bankruptcy filing personal