Discharge credit card debt in bankruptcy
There are many reasons why people have problems with credit card debt, often resulting in the need to file a bankruptcy case. In most of the cases I have filed, there is a substantial amount of credit card debt present.
One reason that people need to discharge credit card debt in bankruptcy is because it is far too easy to obtain credit cards in the first place. If you are old enough to remember, used to be very difficult to get a credit card in the first place. And, getting a credit card was a big deal.
Now, shiny new cards show up in your mailbox without you even having to make an application for them. Perhaps they should show up with my business card attached.
In the old days, if you approached the limit on your credit card, which started out low and it took a while to increase, you would be sternly warned to pay your credit card down because you were approaching the limit of your credit. Now, quite the opposite happens.
Today, if you start approaching the limit on your credit card, and assuming that you haven’t missed any payments, you will be rewarded with an increase in your credit line and probably a package of convenience checks. You will be encouraged to make balance transfers and take that richly deserved vacation that you have been thinking about taking.
No mention of paying your car down. Quite the opposite. Of course, with interest rates on passbook savings now less than 1%, the credit card companies are making a large profit on the interest that they charged the credit cardholders. Interest rates above 20% are not uncommon. I would like to be able to invest my money at 20%.
In addition, the mindset of consumers today has been changed through relentless advertising. I saw a television commercial the other day with scenes of people blissfully swiping their cards for every sort of purchase that you can imagine. In the middle of all this happy spending, somebody dared to pull out cash or a personal check, I cannot remember which. The happy song stopped, the music ended and everybody looked pretty upset with the person who was not swiping the plastic. Interesting, I thought.
And, we are taught today by the very sophisticated advertising that the credit card companies spend millions of dollars putting together, we should only worry about whether we can make the minimum payment. We’ll of course that’s better for them, because if you look at the credit card statement and if it has a substantial balance on it you’ll notice that it’s probably going to take a 27 years to pay that card off by making minimum payments. 27 years of minimum payments a 20% interest results in huge profits for the credit card companies.
Too often, I see people paying their cards down to make room on the card to charge more living expenses. This cycle continues until it becomes nearly impossible to ever pay the card off. Often times this continues for years until some other economic catastrophe strikes and the consumer is forced to look at some hard options. Like discharging the credit card debt in bankruptcy.
As a certified consumer credit counselor, I can show you how to
discharge credit card debt in bankruptcy,
get a budget that works for you, eliminate the need to charge for living expenses on credit cards, and actually rebuild your credit. The ironic thing about all this is that I use credit cards as my primary tool to help my clients rebuild credit.
Like any tool, if used properly one obtains good results. But improper use can result in serious problems. Credit cards can do both. I just love to discharge credit card debt in bankruptcy. I should make my own commercial about this.