Credit Card Debt Relief
Updated: Apr 22, 2022
How To Pay Off Credit Cards Fast.
Too Much Debt
We all have way too much credit card debt. The average American household has approximately $6,829.00 in debt, according to 2019 Nerdwallet statistics. If you included other types of debts such as mortgages, auto loans, and student loans, the total debt per American household is $136,206.00.
Today's economy is built on debt, which means plastic. Even if you want to pay in cash, you still need credit for large purchases or moving into a new apartment. Since the 1980s, the United States has gone from the world's largest creditor to the largest debtor. Being a good American means being a good consumer.
Unfortunately, like any hangover when the party's over, credit card debt becomes a splitting headache. Even as you feel you are making progress by paying your monthly minimum payment or sometimes a little extra, your debt keeps growing.
By looking at a debt relief calculator, you can see how compound interest is not your friend. The accruing interest rate makes it almost impossible to pay down your credit card bills. The interest is currently averaging 17.40 %, according to creditcards.com, (October 2019).
How To Get Rid Of Credit Card Debt
So how do you pay off your credit card fast? What is the best way to pay off credit cards? Should you look up the best way to pay off debt on google or go to your local bank and apply for a home equity loan. Some people even ask if you can pay a credit card with a credit card; this is NOT how to get out of credit card debt!!.
For example, Dave Ramsey recommends using his "Debt Snowball" method to pay down the smallest credit card debts first. However, most "experts" are usually better at teaching a seminar and selling books than actually helping people find a practical solution to their immediate debt problems.
Now I am not saying Dave Ramsey doesn’t care only that his methods are suitable for a small minority of people with debt troubles. Most peoples live’s are not in the calm, stable place where they need to be for his ideas to work.
Other "experts" will recommend contacting a non-profit foundation for credit counseling, counseling association of America, or national foundation for credit. This is similar to taking a class on engine repair when you need to be at work by 3:00 — helpful information to know but not very useful for the current problem of getting to work.
Credit Card Consolidation Loan
One popular option is to try and get a credit consolidation loan from your bank. Try and research "best debt consolidation" or "best debt consolidation loans" to see if you can consolidate your credit card debt into one monthly payment. However, typically, due to your high debt to income ratio, your bank will not approve you for this type of loan.
The loan offerings you will receive from companies that work with people who have minimum credit scores have very high fees and interest rates. This can be a benefit in the short term by reducing your monthly payments but will cost more over the longer extended duration of the loan.
Sometimes you may even be required to sign up for financial counseling with a consolidated credit counselor if the consolidation loan is through a non-profit organization. There is nothing wrong with getting some tips from a certified credit counselor. However, again, this is more "window dressing" than getting you out of your financial "hole" as quickly as possible.
To find the best consolidation loans and learn how to consolidate your debt, click the link for more information on getting a loan to pay off your credit cards. This may not be the best way to pay off your credit card debt, but it is an option that will help in the short term by reducing your monthly payments.
So, How Do We Pay Off Credit Card Debt Fast?
Let's start by putting some financial realities into perspective; you may ask. How long will it take to pay off your credit card balance? According to the Federal reserve's credit card repayment calculator, assuming a balance of $9,500.00 with an A.P.R. of 15% and monthly minimum payments of $190.00. It will take you 32 years to pay off your credit card debt 😟.
Now that we understand the seriousness of the situation, we can move forward with some solutions. Although debt settlement, debt management, credit card consolidation, and home equity loans are all options, none effectively solve the problem.
Most people in the real world, due to their debt to income ratio, will have fair to poor credit scores. This means somewhere between the 500-680 range. It is disqualifying you from the loan amounts necessary to consolidate your debts. This will narrow your options for the best cost-saving consolidation loans available. Leaving only programs with extended terms, higher interest rates, and hefty fees.
A Program Backed By The Law
Debt Validation is a set of statutes that were created by Congress in 1977. These federal statutes that fall under the umbrella of the Fair Debt Collections Practices Act (F.D.C.P.A.) are a powerful tool in helping the American consumer out of serious debt situations. Unlike the aforementioned debt-relief options listed above, these are consumer laws that have "teeth."
The laws were designed to protect the American consumer from repent criminal mischief by debt collectors and debt buyers in the 1970s. However, today, they are just as effective but rarely used.
When appropriately executed as a "strategic default," they allow the consumer to avoid bankruptcy and legally challenge their alleged debt. This is not a pay, hope, and pray situation like most debt settlement scenarios. This is the law that compels the debt collectors to prove they have ownership of a debt.
Amazingly the third-party debt collectors can only prove ownership about 50% of the time according to an FTC study done on the Debt Buying Industry. My personal experience it's closer to 95% effective and the most underrated strategy for regaining your financial freedom.
A well-structured debt validation program will typically last 2-4 years. If executed properly, there should be legal representation to settle any debts that can not be invalidated. As I mentioned, this does happen, but not often. Also, a money-back guarantee is a good indicator that the company your working with is legitimate and has confidence in their program. Credit restoration after the validation process will help improve your credit score.
The debt industry is full of "shady" and unscrupulous companies that prey on the financial difficulties of the consumer. These companies say they will pay off your debt fast but are scammers waiting to take advantage of your financial hardships.
This is why it is so important to do research and proper due diligence when finding a debt relief company. Check the better business bureau (BBB) for complaints. Read any reviews you can find on Google or Trustpilot and look up the company on the secretary of state website for the state the company is located.
This should give you enough information to make a sound judgment if this is a company you can to trust. Finally, make sure you find an advocate to be there and represent you if there are any future issues.
Resolving your debts can get “messy,” you need someone who understands the industry. A professional consumer advocate who will fight to win. Someone who genuinely has your best interest throughout the debt relief process. Please contact me if you have any further questions. There is light at the end of the tunnel as long as you are willing to take the first steps.
Revolution Debt Relief LLC
752 South Main Street
Los Angeles, California