Credit cards can be very helpful tools when used correctly and responsibly. However, credit card companies these days seem to always come out with new ways to motivate consumers to use credit cards and take on debt. Unfortunately, it doesn’t take much for credit card debt to begin spiraling out of control. Here are a few ways Michigan residents can get out from under overwhelming credit card debt.
To begin paying off credit card debt, always pay more than the minimum payment. This will ensure that at least some of the payment will go toward the actual balance rather than just covering the interest. For multiple credit cards, the debt snowball method of paying is often effective. To use the debt snowball method, prioritize debt by amount owned and focus on paying off the smallest one first. When the smallest debt is repaid, roll that payment into the amount to be paid on the next smallest balance, and so on.
Those who have many credit cards may also want to consider debt consolidation. Although it might feel counterproductive to apply for another credit card, it can be helpful to find a company offering zero percent interest and transfer all outstanding credit card debt over. A fixed-rate debt consolidation loan can also be effective. These personal loans will have interest rates, but they are often lower than the interest rates for credit cards.
However, if the total amount of debt owed is completely overwhelming and more than a person can pay, it may be necessary to take more serious steps. Bankruptcy may be something to think about. In particular, Chapter 7 bankruptcy can erase certain types of debt, such as credit card debt. Those in Michigan who want to know more about filing for bankruptcy may want to consider contacting a legal representative who is knowledgeable in bankruptcy law. A seasoned attorney can answer questions and guide individuals through the bankruptcy process.
