Credit Card Debt: How To Control It
A lot of people spend more money than they can afford to repay toward their credit card debts. To regain control over your finances and to manage your debt, here are some solutions you can try.
CREATE A SPENDING PLAN
In many cases, people design and then stick to a spending plan to get their debt under control. A spending plan is a guide for how much money you have and how much money you spend. Sticking to a realistic spending plan allows you to pay off your debts and save for the proverbial rainy day.
CREDIT COUNSELING
Many universities, military bases, credit unions and housing authorities operate nonprofit financial counseling programs. Even though some may be called non-profit, a fee may be charged for their services.
Creditors may be willing to accept reduced payments if you're working with a reputable program to create a debt repayment plan. When you choose a credit counselor, be sure to ask about fees you will have to pay and what kind of counseling you'll receive.
A credit counseling organization isn't necessarily legitimate just because it says it's nonprofit. You may want to check with the Better Business Bureau for any complaints against a counselor or counseling organization. DECLARING
BANKRUPTCY
Bankruptcy is considered as an extreme last resort credit solution. Unlike negative credit information that stays on a credit report for seven years, bankruptcies stay on a credit report for 10 years.
Bankruptcy can make it difficult to rent an apartment, buy a house or a condo, get some types of insurance, get additional credit, and, sometimes, get a job. In some cases, bankruptcy may not be an easily available option.
WHEN TO CONTACT CREDITORS
If you're having trouble paying your bills, contact your creditors immediately. Tell them why it's difficult for you, and try to work out a realistic modified plan that reduces your payments to a more manageable level.
Don't wait until your accounts have been turned over to a debt collector. At this point, it may be too late. Take action immediately and keep a detailed record of your conversations and correspondence.
USE CAUTION WITH DEBT COUNSELING
Turning to a business that offers help in solving debt problems may seem like a reasonable solution when your bills become unmanageable.
Be cautious. Before you do business with any company, check it out with your local consumer protection agency or the Better Business Bureau in the company's location. One rule to remember is that if a credit repair offer seems too easy or just too good to be true, it probably is too good to be true. And knowing your rights can help you steer clear of rip-offs.
As you try to take control of your credit card debt, be on the lookout for advertisements that offer quick fixes. While ads pitch the promise of debt relief, they rarely mention that this relief comes in the form of bankruptcy.
Because bankruptcy stays on your credit report for 10 years and hinders your ability to get credit, it's important to ask for details before agreeing to any debt-relief services.It's a good idea to check the information found in your credit report at least once a year.
Since credit reporting agencies don't share files, you'll need to contact each reporting agency to make sure the information about you is correct. The three major credit reporting agencies are: Equifax (1-800-685-1111); Experian (1-888-397-3742); TransUnion (1-800)-888-4213.
Jamie Madison is the webmaster at http://www.ReviewMyCreditReport.com where you can request a FREE copy of your credit report. Visit today for a copy and keep track of what your credit report says about you.
MORE RESOURCES:
 Calgary Herald | Bush: US will work with partners on credit crisis The Associated Press - WASHINGTON (AP) — President Bush says world's wealthiest industrial countries will work together to attack the credit crisis spreading around the globe. ... G7 seeks to halt global crisis Bush says financial crisis needs coordinated response US pleads for patience in crisis repair efforts |
 Boston Globe | Global leaders seek answer to credit crisis San Francisco Chronicle, USA - At the same time, loan markets everywhere remained broken, especially the critical wholesale credit markets, in which financial institutions lend each other ... Video: Bernanke: More Economic Pain Ahead TREASURIES-Surge in Europe as shares skid on credit woes Stocks down despite government moves to free up credit |
 The Associated Press | US will work with partners on credit crisis: Bush CBC.ca, Canada - It was the 21st time in 26 days that the president has spoken publicly about the credit crisis gripping financial markets and dragging down stock markets. ... Meeting G7, Bush Vows World Economic Fix |
 Calgary Herald | High anxiety rules Wall Street as global credit crisis deepens Emirates Business 24/7, United Arab Emirates - High anxiety on Wall Street will not subside this week as the deepening credit crunch pushes the international economy into recession and corporate profits ... Video: Stocks Fluctuate After Fed Corporate Debt Plan Easy credit and financial crisis G-7: We're Working On It |
 New York Times | Lehman Credit-Default Swap Payout Could Climb as High as $365 Billion Washington Post, United States - By Heather Landy NEW YORK, Oct. 10 -- In what may shape up to be the most expensive payout ever in the credit-default swap market, sellers of insurance ... STOP FINANCIAL WMD'S: Credit Default Swaps Insurance on Lehman Debt Is the Industry’s Next Test Lehman Credit-Swap Auction Sets Payout of 91.38 Cents (Update1) |
Is my credit union safe? Los Angeles Times, CA - By E. Scott Reckard, Los Angeles Times Staff Writer The government-run National Credit Union Share Insurance Fund insures most deposits at credit unions, ... Got Your Money in a Credit Union? You Too Are Safe In tumultuous financial times, credit unions might be an option to ... LETTER: Your money is safe with credit unions |
 Los Angeles Times | Fears Grow That Tight Credit Could Crush GM, Ford NPR - Standard & Poor's downgraded the credit of both companies and their financing arms this week. AFP/Getty Images Ford F-150 trucks sit at a dealership in ... Video: Money Minute: GM, GE, Oil GM, Ford too big to fail? CREDIT WATCH HITS GM, FORD |
Financial troubles spread to credit unions Los Angeles Times, CA - By E. Scott Reckard, Los Angeles Times Staff Writer It's not just giant banks on the brink these days: Losses are clobbering nonprofit credit unions that ... |
 Citizen | Credit Crisis Collapse What Happens Next? The Market Oracle, UK - To not take actions to stem the credit crisis would be that major policy mistake which would compound all the other mistakes. I think everyone knows the ... Regional financial experts focus on lending; say credit crunch is ... Market news this week for strong stomachs You have some input on interest rates |
 Voice of America | IMF endorses G7 plan to fight global credit crisis CTV.ca, Canada - The International Monetary Fund is backing a plan by Canada and the other G7 countries to fight the worldwide credit crisis, which continues to play havoc ... Video: IMF: Timing right for G7 Credit CRISIS ALERT Press demands some G7 credit crunch punch |
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