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What Are the Different Credit Card Debt Relief Options?

A credit card allows consumers to purchase goods and services by borrowing money from the issuer. After borrowing money, the consumer pays it back in full or monthly installments. While getting a credit card offers convenience, if the consumer’s credit card debt is out of hand, they may require help with credit card debt.  

Woman needs Help with Credit Card Debt

Options for Credit Card Debt Relief

Credit Card Balance Transfer

If the user’s credit card balances are racking up high-interest charges, but their FICO score is still good, a balance transfer card may be an option. In such cases, they can take out a credit card with a low or no interest rate for a year or more and roll as much of their debt as possible to it.  

However, it’s important to note that they should be wary of the new card’s interest rate after 12 to 18 months have passed. It’s best to slash the balance for all its worth. 

Debt Consolidation

Debt consolidation can make it easier for a person to pay off what they owe on multiple credit cards if they have good credit. This simple concept involves rolling high-interest credit card balances into a single loan with one monthly payment. This method is especially beneficial for those who can do so at a lower interest rate because it reduces the amount they pay each month or shortens their repayment period.  

Although having a good credit score is preferred, it’s not always necessary. Even with bad credit, getting a debt consolidation loan is still possible. Unfortunately, often the borrower has to secure the loan with property, such as their home or car, meaning they could lose that property if they go into default 

Consult the Credit Card Company

Individuals dealing with credit card debt can contact their credit card companies to see if they can lower the credit card interest rates, waive fees, or both. Since lenders are looking for reliable borrowers, it’s safe to say that the loan market is fiercely competitive.  

A study shows that nearly all customers who threaten to do a balance transfer usually get the break they ask for. Furthermore, many credit card issuers offer hardship programs to customers with good payment records.  

Customers may qualify for a program if they lose their job or suffer a health setback that adversely affects their ability to pay. Keep in mind these hardship programs typically expire in one year and then the original percentage rate returns after their internal hardship program is over, and the card is likely to still have a significant balance. 

Find a Nonprofit Debt Counseling Company

Nonprofit debt counseling organizations offer debt management plans to help people pay their credit cards in full with concessions such as reduced interest rates, waived fees, or re-aging payments to “current” (re-aging is getting your payment due to read “current” vs. 30, 60, or 90+ days late on your credit report). Credit card companies work hand-in-glove with certified credit counselors to offer people affordable payments that eliminate debt.  

Illustration of Help with Credit Card Debt

Need Help with Credit Card Debt?

DebtHelper.com is an IRS-approved 501(c)3 nonprofit Florida Corporation dedicated to its mission to educate, advise, and empower people to handle their finances better. Contact us today to make an appointment with a certified counselor. 

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