Overwhelmed with credit card debt? You’re not alone

Credit card balances in the U.S. have hit more than $420 billion, an increase of 5 percent over 2017, new research shows.

The debt can feel overwhelming: 9 percent of those with credit card debt don’t believe they will ever get out from under, polls show.

Three options

If you find yourself in over your head, you have likely tried a variety of ways to get yourself out from under the debt. You have tried cutting up cards, getting low- or no-interest cards and putting high-interest debt on them, paying only the minimum and watching your interest mount, and so on.

After trying these methods, you usually only have three options left:

  • Call your card issuer and ask to set up an alternate payment plan
  • Get credit counseling who can help you put together a budget
  • Declare bankruptcy

A credit card payment plan is sometimes called a hardship plan. Most credit card companies offer them but you’ll rarely see them advertised. They are meant to get as much money as possible before you declare bankruptcy. They often offer a combination of:

  • Lower interest rates
  • Smaller minimum payments
  • Lower fees and penalties
  • Fixed payment schedules

The credit card payment option can affect your credit score because it the company may close your card while you pay it off. Closing a card can affect your length of credit history and your credit mix, both of which result in a lower credit score.

Credit counseling or bankruptcy

A credit counselor will, for a fee, analyze your spending and your income and then negotiate a repayment plan with your creditors. You make one deposit each month with the counselor who then distributes the money to your creditors.

Bankruptcy involves going to court and declaring either Chapter 7 or Chapter 13 bankruptcy.

In Chapter 7 bankruptcy, non-exempt possessions are sold and used to pay off your creditors who are then forbidden to continue to seek repayment from you.

In Chapter 13 bankruptcy, your debts are reorganized and you are put on a schedule to pay the debts back in between three to five years.

If your credit card debt is great and you have tried to refinance, tried to work with the credit card companies, tried to maintain a budget and you still are in over your head, you should talk to a qualified, experienced attorney to discuss your options under bankruptcy. It may be the best way out of a bad situation.

No Comments

Leave a comment
Comment Information

Get Our Help Today

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.


Privacy Policy

Office Locations

Cherry Hill Office
1060 North Kings Highway,Suite 333
Cherry Hill, NJ 08034

Toll Free: 800-759-0767
Phone: 856-254-2196
Fax: 856-414-1230
Map & Directions

Philadelphia Office
Suite 1505
1515 Market Street
Philadelphia, PA 19102

Toll Free: 800-759-0767
Phone: 215-928-9199
Map & Directions

Willingboro Office
200 Campbell Drive
Suite 103F
Willingboro, NJ 08046.

Toll Free: 800-759-0767
Phone: 856-254-2196
Map & Directions

Philadelphia Office
7909 Bustleton Avenue
Philadelphia, PA 19152

Toll Free: 800-759-0767
Phone: 215-928-9199
Map & Directions