Credit Debt Negotiation Settlement
02.September, 2008
Been considering a credit debt negotiation settlement? Well I’ve got good news and bad news. The good news is that you really can negotiate a debt settlement and save thousands in principal, interest and fees.
However, the bad news is that, unless you are a debt negotiations expert, you really can’t do it on your own. The law is just too complex, and most of us simply don’t know our rights.
You could hire a professional debt negotiations firm to represent you - they are often very successful at getting your debt reduced by as much as 50% or more.
The trouble is that these companies usually charge thousands of dollars for their services, and the odds are, if you had that much hanging around, you would have been paying off your credit card bills in the first place.
So what exactly can you do if you’re stuck with a mountain of debt and harassing calls from creditors and collection agencies?
I’ve found a company that offers a great solution for a fraction of the cost of most debt negotiation firms. The company is called Zipdebt, and they offer a unique combination of educational packages and phone consultations with a real live debt negotiations expert that prepare you to actually take on your creditors yourself - and win.
The owner of Zipdebt has made a great offer for my readers - he’ll knock $25 off any order. Just enter code AFF-069 when you order any of their packages, and the $25 will be deducted automatically from your order.
So check out Zipdebt’s packages, and possibly save yourself thousands of dollars. It really is an excellent way to attack your debt.
How to Reduce or Eliminate Credit Card Debt With Balance Transfer Offers
04.September, 2008
Of course, The best way to get out of debt is not to get into it
in the first place - in other words, pay off your credit cards
fully every month. This is really the only way to be debt-free,
enabling you to avoid interest and finance charges. None of the
major credit card companies (Visa, MasterCard, American Express,
or Discover) penalize you for doing this.
The ideal is to live within your means, spending less money than
you make. It is a sure way to stay out of credit card debt.
The Solution
But if you are reading this, chances are you’ve already
accumulated too much credit card debt. Here are your
options:
Option #1: One thing you can do if you have outstanding balances
on high interest credit cards, is to do a balance transfer onto
a lower interest credit card.
Of course you first need to have a balance transfer offer from a
credit card company, with a card that has a lower interest rate
than the one you are trying to pay off. Visa, MasterCard,
American Express, and Discover all have a variety of different
cards, with different interest rates. By transferring your
balance to a card with a lower interest rate, you can save
hundreds if not thousands of dollars in interest charges. You
can compare these cards online (see resource box at bottom).
If you get lots of offers (as you will if your Equifax Score is
higher than 690 - rated “good” - and you may even get a few
while rated “fair”) you will be able to pick and choose among
balance transfer offers. Look for ones that keep the low rate
until you have paid off the balance transfer completely. In some
cases, you may want to accept one that raises the rate after
some months, as long as that new rate is lower than the one you
have on the card you are trying to pay off.
Sometimes the best balance transfer offers come with a new
credit card. You will find reviews of some of the best at creditoffersre
view.com. Do remember, however, not to apply for too many
at once - sure to lower your credit card score.
A Few Things to Remember
For ease in understanding, we will call the high interest card
you are paying off Card A, and the one you are transferring
balances to, Card B.
1. Be careful to continue making payments on Card A. until your
payment shows up (you can check most credit card balances on the
credit card website, by logging into your own account.)
2. Try to time it so your transfer pays that month’s payment. Do
this by making the balance payment right away when you have just
received your statement for Card A. That gives several weeks for
the payment to post. Then you will not need to make a regular
payment that month and can apply more to some other card.
3. Experts vary on their advice about what card to pay off
first. I prefer to pay off the highest interest card first, but
others say the satisfaction of paying off a card with a smaller
balance (because you can pay if off quicker) is important to
your motivation to keep paying down that debt. I get my
satisfaction in seeing the interest and minimum balances drop
drastically as I pay down the very high interest rate card.
4. Be careful to leave a few hundred on Card B so its next
interest charge will not make you overdrawn. Apply as much as
you can to Card A, but not all of it.
5. Be aware that almost all cards doing balance transfers with a
very low interest rate offer are going to apply any payments you
make to those lower transfer balances first. So it is best if
you only do a balance transfer to a card that is totally empty.
If you have charges on it at its normal interest rate, they will
continue to accrue finance charges at the higher rate all the
time the lower rates transfers you did later are being paid
down.
Option #2: You can also transfer your balance from a high
interest card to one with a low introductory interest rate - If
you are like most of us, you probably get these in the mail all
the time. “Limited time offer!” “Pay no interest for 6 months!”
“0% till next May!” All of these cards offer an introductory low
APR (sometimes 0%) when you get their credit card. But you have
to be careful if you use this option. Use it only if you plan to
pay off the balance BEFORE the grace period ends. If not, you
might end up paying more than you would have originally.
Option #3: Another option is to get a credit card debt
consolidation loan - it can take a lot of the stress out of
trying to juggle credit card accounts. It allows you to
consolidate all your credit card debt into one easy payment at a
fixed interest rate. This rate is almost always lower than the
one the credit card companies will give you. The draw back is
that you have to be very careful who you get such a loan from,
especially is they promise they will negotiate lower credit card
payments, so that you are not paying all you owe. If it is from
a credit counseling agency like that, it may harm your credit
rating.
Before applying for any credit card, you may want to discuss
with your financial advisor which credit card’s best for your
unique financial situation.
How to eliminate credit card debt?
02.September, 2008
READER QUESTION: When a card holder uses a credit card, he is borrowing from the credit company. How he eliminate his credit card debt.
EDITOR’S ANSWER: You need to take some time and learn about money management. It sounds like an old, worn out line but it is true. Using credit cards can help “balance” your money to some degree but it needs to be used wisely. By balance I mean that it can help you during low points of available cash. For people being paid monthly, credit cards can be a real help.
The only proper way to get out of debt is to pay it off and manage your money better.
[Again, you could also check out Zipdebt.com for their support and training packages that show you how to negotiate a settlement on your debt. Of course, if you can still afford to make payments, by all means definitely do. But if you have fallen way behind, then it is time to get serious and contact Zipdebt, or at the very least study up on your rights under the Fair Debt Collection Practices Act at your local library.]