Help! I Cannot Pay My Credit Cards!
If you are reading this post, it is likely that you are one of the hundreds of thousands of Americans who are struggling to pay their bills as the country continues to cope with the economic recession. Because the recession has resulted in many people losing their jobs (and the inability of many college graduates to secure their first job), a large number of Georgians have been forced to resort to using credit cards to pay for their household necessities. Unfortunately, credit card debt can build up very fast.
There are a few options available for people who cannot pay their credit card bills, including negotiating with the credit card companies and filing for bankruptcy.
How Can I Negotiate with the Credit Card Company?
The idea of negotiating with a credit card company may be scary to some Georgians but you may be surprised at how often this strategy is successful at lowering credit card debt. It is as easy as calling up the company and speaking to an account representative.
The pros: Some companies may agree to lower the interest rate on the debt, which could save hundreds of dollars. The reason why companies are amenable to this agreement is because they will usually get paid more of what is owed to them as opposed to if the customer files for bankruptcy.
The cons: This option is by no means a guaranteed success. It is up to the company to decide if it wants to lower an interest rate or not so the bargaining power is a bit one-sided.
What About Filing for Bankruptcy?
High credit card debt is one of the most often cited reasons for why individuals and families file for bankruptcy (the other reason being high medical debt). Filing for bankruptcy allows the person to either discharge all of their credit card debt (by filing Chapter 7 bankruptcy) or to make more manageable payments on their debt for a certain period of time before discharging the remainder (by filing Chapter 13 bankruptcy).
The pros: If your family is trying to cope with several different types of debt burdens, such as credit card debt, a bad mortgage, car payments, and medical debt, than filing for bankruptcy can often kill two birds with one stone. The bankruptcy process allows you to deal with (and often discharge) all of your qualifying debts at one time.
The cons: Bankruptcy is a very serious undertaking and it has implications for your life beyond getting rid of your debt. For example, bankruptcy will stay on your credit report for years. Additionally, there is a prohibition of filing bankruptcy multiple times within a small period of time.
Bankruptcy is not right for everybody and is a complicated process. If you have questions about what you can do to cope with your high credit card debt, contact our office today to speak to one of our attorneys about your case. We look forward to working with you!