If your budget is burdened by credit card debt, you’re not alone. More than 41% of U.S households are carrying credit card debt, at an average of $9,333 per household. And, those who can least afford it are carrying the greatest burden. Households with zero or negative net worth have the highest average credit card debt, at just over $10,300.
Depending on your interest rate and balance, you may make minimum payments for months or years and see little change in the amount you owe. At 14.14%--the current average interest rate for existing credit card accounts—that $9,333 balance would take nearly 12 years of minimum payments to pay off. That’s without any new charges or late fees. And, of course, many people struggling with debt are paying much higher interest rates. The same balance at 29% interest would require 20 years of minimum payments.
Credit Card Debt Can Be a Trap
Credit card debt is expensive debt, and it becomes even more expensive if you fall behind and add late fees to interest charges and other fees. If you fall far enough behind, your account may be closed, and the balance escalated. That means the credit card company will be asking for the full balance, not just your normal monthly payment. Internal collections staff may call you several times a day. And, if collection efforts are unsuccessful, the debt may be sent to collections, sold to a debt buyer, or a lawsuit may be filed.
In this situation, many people panic and make a quick payment, trying to stave off further collection activity. This is almost always a serious mistake, as a single payment can re-start the statute of limitations, giving the credit card company or debt buyer several extra years to pursue payment.
Whether you’re watching current credit card debt mount, being pursued by debt collectors, facing a lawsuit, or already have a judgment against you for unpaid credit card debt, you have options.
Managing Credit Card Debt
The best way to manage your credit card debt will depend on a variety of factors, including the status of the debt. Your options for managing a debt that is still with the original creditor may be more limited than your options for negotiating or challenging a debt that is in collections or has been purchased by a debt buyer.
If you’re facing a lawsuit over unpaid credit card debt, quick action is required. Many lawsuits for unpaid credit card debt end in default judgments, because the account holder didn’t respond or show up in court.
When you start your DebtCleanse membership, your attorney will explain your options and help you determine the best way to move forward.
DebtCleanse Can HelpWe’ll give you the strategies and resources you need to put debt collector stress behind you.
When you sign up with DebtCleanse, we’ll team you up with an attorney in your state. Your attorney will tell creditors to direct any future communication to their law offices. This should immediately stop harassing calls and letters.
Your attorney will also interview you and comb through your documents for any violations of the Fair Debt Collection Practices Act (FDCPA), Fair Credit Reporting Act (FCRA), Telephone Consumer Protection Act (TCPA), Real Estate Settlement Procedures Act (RESPA) or other federal and state laws. Those violations create leverage to challenge your automobile loan and any other types of debt. If creditors and debt collectors don’t get in line, your attorney will hold them accountable.
Often, debt collectors stop collection action as soon as they receive a letter from an attorney, focusing their efforts on people who are less likely to fight back. And, many consumer protection statutes require debt collectors who break the law to pay your attorney’s fees. So, our members can often resolve debts without paying anything beyond the membership fee.DebtCleanse can put you back in control with creditors and debt collectors.