Is your average debt amount more than $7000?

If so, then dude you’re in big trouble since the outstanding balance in the top 5 cities with highest credit card debt is $7000 with Washington topping the list.

  • Washington, D.C. Average card balance $7442.
  • Dallas. Card balance $7171
  • New York City. Average credit card balance $7145
  • Houston. Average credit card balance $7121
  • San Antonio. Average credit card balance $7070

Source: Blog.credit.com

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Don’t panic.

You’re the not the only one who is struggling with debt. The entire country is suffering from debt overload syndrome. The US credit card debt has crossed the $1 trillion mark in 2018. The question is not about whether consumers are financially weakening. Rather, the question is when consumers will stop their pre-recession habits and lead a healthy financial habit.

Alina Comoreanu, the senior researcher at WalletHub says 92% of consumers are quite confident that they will have less debt by the year-end.

  • 1 35% of consumers feel that it’s fine to increase credit card bills for the sake of traveling
  • 2 10% of consumers don’t remember why they incurred so many bills
  • 3 88% of consumers feel they manage their personal finances better than the federal government
  • 4 70% of consumers feel that another recession will hit the country in the next 2 years

What’s the way out?

Fortunately, OVLG is there to help you reduce credit card debt. Our Financial Coach has all the tips to help you cope with it. We have shared the top 6 tips below.

  • 1Consolidate credit cards into one payment through a credit consolidation program
  • 2Stick to the household budget and review it every month
  • 3Create an emergency fund
  • 4Look for new opportunities to combine credit card debt into an affordable repayment plan
  • 5Try to knock-off highest interest card quickly
  • 6Compare credit card consolidation programs and choose the best one

Find out what happens after you contact us

How to consolidate credit card debt

Once you know what credit consolidation is and how it helps you become the master of finances, you can reach us instantly. />

Click here to check the Video Transcript.


What is credit card consolidation?

Credit card debt consolidation is an effective way to solve financial problems. This credit card debt relief option helps you combine different credit card accounts with various due dates to one payment. When you’re researching on credit card consolidation programs, make sure you choose one that helps to improve your financial situation. Opt for a program that helps you lower your monthly payment.

Credit card consolidation pros

  • Can pay off credit cards quickly
  • Enjoy a super low-interest rate
  • Make affordable monthly payments
  • Take care of only one bill each month
  • No late fees and over limit charges
  • Fewer collection calls

Credit card consolidation cons

  • May get into debt again as you relax more
  • Some companies charge high fees
  • You may lose assets (secured consolidation loan)

When you should or shouldn't go for credit card debt consolidation

It's not too late yet. You still have a chance to save your wallet and credit score. All you need to do is consolidate credit card debt right now. But before you begin the process, let's find out a little bit about the scenarios when it will work best.

Should
  • Want to get a reduced interest rate
  • Wish to get a fixed interest rate
  • Wish to kick out debt fast
  • Want to pay one bill every month
Shouldn't
  • Can't even pay one bill on time
  • Have secured debts
  • Have enough money to manage credit cards
  • Don't know how much your savings will be

Best way to get out of credit card debt

1

Credit card consolidation programs

Scenario 1:
You want to switch from multiple payments to one

Best option to consolidate credit card debt:
Credit card consolidation programs

How it works:
Here you make only 1 monthly payment to credit card consolidation companies.

Effect on credit:
It has a positive impact on your credit score.

Tip: Check out the credit consolidation reviews and find out if the company is trustworthy.

Consolidation program
2

Balance Transfer

Scenario 2:
You can manage money very well, and your credit score is good.

How to consolidate your credit cards:
Balance transfer

How it works:
Here you consolidate credit cards into one card with 0% APR available for a very short period.

Effect on credit:
Your credit score may drop initially.

Tip: Pay off the entire balance within 6-12 months to avoid paying a high-interest rate.

Balance transfer method
3

Credit card consolidation loan

Scenario 3:
You want to get rid of debt now and have assets

How can I consolidate credit cards?:
Credit card consolidation loan

How it works:
Here you consolidate credit card bills into a personal loan and pay it off after a certain period.

Effect on credit:
It makes a positive impact on your credit score.

Tip: Check out the loan term and rate to avoid paying more than what you expected.

Consolidation loan

Credit card consolidation companies - Checklist to pick the best

  • Check the breakdown of fee structure
  • Check the affiliations
  • Check how long and how much to pay
  • Check their credit consolidation reviews
  • Check their industry experience

Alternative options to reduce credit card debt

1 Credit card debt settlement:
The debt negotiators ask you to save a particular amount in an escrow account (usually known as a trust account) every month to accumulate enough money for settling credit card debt. Once you have saved a specific amount, they will start the credit card settlement process immediately. They will ask your creditors to lower your payoff amount in exchange for a credit card lump sum settlement. They will call creditors and negotiate till they agree to lower your outstanding balance and waive off late fees. Once they give their nod, debt negotiators will ask you pay off the amount agreed upon and complete the credit card settlement process.

2 Credit card debt management:
This credit card debt relief option is usually offered by credit counseling agencies to those individuals who are unable to manage credit cards with simple money management techniques. This option is different from both credit card settlement and consolidation. Here you get a smart budget plan from the counselors who negotiate with your creditors for a lower interest rate on your credit cards and a smart repayment plan. Once they convince creditors for reducing interest rates, you can start paying off credit cards as per the new interest rates.

3 Bankruptcy:
This is the best way to pay off credit card debt when your creditors are not ready to give you any kind of credit card help. You can file Chapter 7 or Chapter 13 bankruptcy depending on your financial situation to pay back your creditors. The US trustee negotiates with your creditors, sells your non-exempt assets within 3-4 months, and disburses payments amongst them in Chapter 7. However, in Chapter 13 bankruptcy, the scenario is completely different. Here the bankruptcy trustee gives you the option of paying off credit cards in 3-5 years through a court-approved payment plan.


Having problems with credit cards?
Call us at (800)-530-OVLG to get professional help

Last Updated on: Wed, 18 Jul 2018

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