Natalia Brophy

Owe More Than $10,000 on Your Credit Card? Read This Before You Pay it Off



Posted: Thursday, February 18, 2010

by Natalia Brophy
http://www.frugaltips.org

According to credit bureaus, nearly 37 percent Americans have more than $10,000 non-mortgage debt. If you happen to be among these people, you may want to reconsider the way you are paying it off, because ironically crossing the 10K credit debt mark can be very beneficial for you.

If your credit card debt happens to be more than $10,000 you are considered to be a customer worthy for negotiation. It means that you will most likely be eligible for a debt settlement program, which will help you reduce your debt significantly.

Credit card companies don't do this because they want to help you out. The reason for these programs is that when you owe thousands of dollars to your credit card company, which are mostly interest anyway, you are a major risk for them.

They are aware that if your financial situation is getting worse, likely you will file for bankruptcy, which will make it much worse for them. It is much better for credit card companies to offer you some sort of debt settlement plan and reduce your credit card debt by 50% than watch you getting deeper in debt and declare yourself bankrupt.

Many companies will agree to lower your interest rate, but if things go well, you can wipe your debt off by 40-50 percent instantly.

There is no doubt that debt settlement can help you get rid of a huge portion of your debt. However if your credit card debt is less than $10,000 don't get tempted to take more credit just so you can qualify for debt reduction programs. Wiping your debt off is a difficult task and if you haven't reached that $10,000 mark yet, it is better to go the other direction and focus on paying it off as soon as possible.

Start your journey to becoming debt-free today ! Here are some free tips for you to start:

http://www.live-debt-free.org

This Article has been viewed 1,100 times. (Not updated in real-time.)
Top-level comments on this article: (1 total)
» left by Dave Baddeley
 1 year 304 days ago.
Great article Natalia. I had 3 credit card debts totalling £14,000 and I managed to settle them all for £5,880, saving around £8k! If you have a lot of debt, dont repay all of it... NEGOTIATE!! :)
We want your comments! If you can read this, you don't have javascript enabled, so you can't use this comment system. Please enable javascript.