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Facing credit card debt

Credit card debt is a problem for many Florida residents. According to the Federal Reserve, the average American household has over $8,000 in debt. Collectively, Americans have credit card debt totaling more than one trillion dollars. For individuals, being unable to pay credit card bills on time can cause a feeling of panic, but experts say that the worst thing a person can do is to ignore the problem.

A vice president of the National Foundation for Credit Counseling advises people to contact their creditors if they can’t make payments. Usually, he says, creditors are willing to work with people and help them to avoid the negative consequences of nonpayment.

Simply not paying and not making any contact with creditors whatsoever can be devastating to a person’s financial situation and credit rating. Thirty days after a missed payment, creditors usually contact the cardholder by phone or mail. If they can’t get a response or explanation and more time passes, late fees are usually charged, and the interest rate on the card may go up as a penalty.

At the 90-day mark, without payment or contact, a credit card may be closed and the matter is likely to be turned over to a collection agency. There could even be a lawsuit or liens placed on bank accounts.

Many people wait until it’s too late to take steps to deal with overwhelming credit card debt. Bankruptcy is an option that many people avoid because they fear losing their home or the stigma associated with it. An lawyer who has Chapter 13 bankruptcy experience can dispel some of the myths and describe the eligibility requirements.

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