Ways to Pay Back Your Credit Card Bills

From: PayingPaul.com - a great site to check out

Option 1: Debt Settlement



Debt settlement, also known as debt negotiation, is a debt reduction service that aims at reducing the principal amount owed on credit cards. Through negotiating with your creditors , you can reduce debt levels by 40 to 60 percent, dramatically lower your monthly payments, and pay off your debts in as little as 12 to 30 months. It is the fastest and cheapest way to become debt free without filing personal bankruptcy, but settlement is typically only a suitable debt option for consumers who are genuinely overextended and unable to afford their minimum payments.



Option 2: Credit Counseling



Credit counseling aims at reducing your interest rates on credit cards. By lowering the interest charges to as little as 0-12%, a consumer can pay their credit card debt off in four to five years and lower their payments. The payments are generally higher than those in debt settlement, so consumers experiencing a financial hardship may be better suited for a debt negotiation program.



Option 3: Filing Personal Bankruptcy

Filing bankruptcy isn’t exactly paying off your debt. That is, the debts are never fully satisfied, you are simply relieved of your legal obligation to them. Due to the catastrophic credit effects, personal bankruptcy is generally considered a last resort for most debtors. However, for consumers with no income or savings to pay off their debt, it may be the only option.




Option 4: Paying More Than The Minimum

Minimum payments on credit cards are generally 2-4% of the outstanding balance. For example, if you owe $10,000 in credit card debt, you can expect to pay between $200-$400 every month in minimums.