Ways to deal with credit card debt
Florida residents may find that their credit card debt will be more expensive to carry if the Federal Reserve goes through with plans to raise interest rates. Most credit card interest rates are tied to the rate set by the Fed. Therefore, as the prime rate goes up, so does the rate on an individual’s credit card. However, there are ways to get rid of interest or reduce the rate paid on a debt.
The first option may be to transfer an existing balance to a credit card with a lower interest rate. In some cases, it might be possible to transfer a balance to a card with no interest for a certain period of time. In addition, balance transfer fees may be reduced or waived for new cardholders. It is important to point out that a debtor may not be able to transfer a balance between cards issued by the same company.
In lieu of a credit card transfer, it might be worthwhile to apply for a personal loan. Personal loans generally come with lower interest rates compared to credit cards. However, these loans generally have fixed repayment periods, which may be ideal for those who are tempted to continually use their credit cards. They will require a debtor to get serious about paying off credit card debt.
Those who are struggling to pay credit card debt may wish to file for Chapter 13 bankruptcy. Doing so could make it easier to reorganize debt and repay it over three or five years. If a balance remains after the repayment period, it may be discharged. Filing for bankruptcy will also put a stop to creditor calls. Generally, interest does not accrue on a debt during a repayment period.