Dealing with Credit Card Balance Transfers that have Gone Bad

Have you done credit card balance transfers that didn�t work out the way you expected? Did you transfer a balance to a low interest credit card and then start charging again on the card that you just paid off? If this has happened to you, you are not alone.

You do have some options for paying off these credit card balances. But first and most importantly you need to stop charging on your credit cards and if that means cutting them up or freezing them, then you need to do it. It is going to be hard to pay off your credit card balances while you are adding to them.

As long as you are making you payments on time and your interest rates are low, you should stick with your current plan, because that is your best option. You should look for a way to increase your income or decrease your expenses so that you are able to pay more than the minimum. Paying more than the minimum will decrease the amount of interest you will be paying over the life of the repayment period.

However, if your credit card company raises your interest rate above 12% you might want to check into consumer credit counseling to see if they can save you money. Keep in mind that consumer credit counseling will have an effect on your credit. It will not devastate your credit, but it may lower your credit score somewhat. If you are making your payments on time, but feel you will not be able to maintain much longer, debt counseling is a good debt option for you.

If you are several months behind on your payments, debt settlement is probably going to be your best option. Debt settlement involves either you or a debt negotiation company negotiating a reduced balance that your credit card companies are willing to accept. You must be aware that this option will negatively affect your credit, but if you have not made your payment for several months your credit has already been negatively affected. This is a good alternative to bankruptcy and will not affect you credit as much as bankruptcy.

If you have gotten in financial trouble over credit card balance transfers, there is hope, but it is going to take some discipline and some changes in your lifestyle to be able to regain control over your credit card balances.

Marjorie Salada is the owner of debtmanagement1.com, a website that contains information on debt consolidation, debt settlement, debt counseling and how to manage credit card debt.

The Problem with Credit Card Balance Transfers

We receive them in the mail every day. They are those pesky envelopes that are offering us 0 % interest for the next 12 months. On the surface, not only does it sound like a good deal, but it is also very tempting.

But let�s consider a few things. If you are carrying a credit card balance, unless you had an unusual emergency, you are probably not all that disciplined with your finances. So, what happens when you transfer your balance to that shiny new card you just got? Now have an old card that has no balance on it at all or in other words it has lots of available credit.

What are you going to do with all that available credit? Statistics show that most people use it. Now not only do have a balance at 0% interest, but now you have a balance on the card that you transferred from.

Bottom line is if you have a balance on both cards, you didn�t gain any ground by transferring it to another card, because now you have 2 cards each with a balance. If you are going to transfer to a card with a lower rate make sure you are the one with the advantage and not the credit card companies.

Marjorie Salada is the owner of debtmanagement1.com, a website that contains information on debt consolidation, debt settlement, debt counseling and how to manage credit card debt.

Should You Pay Off Your Debt With a Home Equity Line of Credit?

Home equity lines of credit are based on the equity in your home and it is just that, a line of credit. If you have equity built up in your home this line of credit is a good thing to have. The interest rate on home equity lines of credit are based on the feds funds rate. In other words the interest rate on a home equity loan will rise when the Federal Reserve raises the prime rate.

Just because you have this line of credit does not mean that you have to have anything on it. I know people that have them for emergencies and may not use them for many years, but if something does happen, it is as simple as writing a check to have some extra money and the interest rate is far lower than that of a credit card and the interest is also tax deductible.

Short term borrowers make good candidates for home equity loans because they can get a good rate due to the short term on the loan. This is an excellent option for consolidating your debts if you can pay them off in five years or less. Once you have paid off the loan, the account can be kept open for that day that you might need it.

You can also get a home equity loan that has a longer term, but your interest rate will be higher than most fixed rate mortgages. Although, this rate will probably still be lower that what you are paying on most credit cards. So if you are looking for a way out of debt and are fairly disciplined with your money, a home equity line of credit is a smart way to go as long as you can pay it off in five years or less.

Marjorie Salada is the owner of debtmanagement1.com, a website that contains information on debt consolidation, debt settlement, debt counseling and how to manage credit card debt.