Personal debt is an issue in the forefront of many consumers\’ minds these days as the average household supports about $23,000 in personal debt. That includes personal loans, auto and student loans, medial debt as well as credit card debt. In a tight economy, people are looking for ways to do away with these debts.
Until recently, most creditors were unwilling to negotiate debts. There was little motivation to drop interest rates or balances on credit cards. Student loans enjoy a legal protection that gives creditors virtually no incentive to negotiate them, and auto loan debts are typically not negotiated because they\’re secured debts, which means the lender would just simply reposes the vehicle.
Credit card debt has come under increasing scrutiny, both by lawmakers and consumers. Recently enacted legislation changes the way credit card companies like American Express can assess debt and process payments, changes that favor the cardholder. Unfortunately, these changes won\’t take effect until July 1, 2010. In the mean time, consumers will have to pay their credit card debts following the old rules.
When carrying more than $10,000 in credit card debts, the minimum payments can be staggering, sometimes rivaling a mortgage or auto payment. Consumers who carry a balance are typically at the mercy of credit card companies when the issuers change the cardholder agreement. The only way out of the new terms, in most cases, is to pay off the balance and then cancel the account.
The $10,000 debt load is more than just a psychological milestone. For most consumers, it indicates a serious problem with their finances. Most consumers can\’t pay back unsecured debt at this level, especially when these balances may carry interest rates of as much as 30 percent per year.
When credit card balances exceed $10,000, and consumers are unable to afford to make the minimum payments on their accounts, some are now considering alternatives. Depending upon their circumstances, consumers are finding it beneficial to consider credit counseling, debt consolidation or even debt relief. Depending on the situation, many are finding credit counseling, debt consolidation and debt settlement as a part of a larger strategy to help them get on top of not only credit card debts, but also other debts including unpaid medical bills and unsecured loans that may be destabilizing their finances.
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March 31st, 2009 at 11:15 am
Our country is feeling this recession. Each person who has excessive credit card debt should read up on the possible solutions you mentioned, consolidation, accelerated pay off plan, settlement, etc.
October 11th, 2009 at 11:32 am
Very, very interesting post.Thx.
November 15th, 2011 at 4:40 pm
There was an article in the NYT yesterday that did a good job of outlining the types of fees banks can use instead of blatantly charging debit card fees. As I’ve been arguing all along, whether we like it or not (I don’t like being charged for using my checking card or account), the issuers will find ways to make up for their lost debit card interchange revenues.
The Durbin Amendment that mandated the Federal Reserve to place a cap on these fees was a huge boon for big-box retailers. When it’s all said and done, the banks will not be worse off than before the reform took place and consumers will end up footing the bill. http://blog.unibulmerchantservices.com/debit-card-fees-may-be-gone-but-overall-banking-costs-go-up
February 25th, 2012 at 11:15 am
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April 23rd, 2013 at 7:09 pm
Lending money to a friend or relative means that your money will not
be invested in some other asset. Paper documentation is not at all entertained by the
lenders. The important thing though is that you get access to the
funds you badly need.
May 11th, 2013 at 7:34 am
What you believe about the food you eat determines how it affects your body.
If you are not in the pink of health, then weight loss
surgery is obviously not for you as you may not only fail
in losing weight but ended up losing your life as well.
Then it was off to enrolling in the Silver Hill Psychiatric Hospital in New Canaan, Connecticut.
May 22nd, 2013 at 5:08 am
Do you remember the TV table tennis game from the late 70’s.
It just seems difficult for men, especially, to settle down and not work.
“As always, there are the usual ‘nominees’ and some newcomers, some famous and some unknowns, hailing from the four corners of the world.