Wednesday, 30 January 2019

Simple Step To Get Out Of Credit Card Debt

I want to talk about a subject, not really as sexy but it is necessary, its finances specifically getting out of credit card debt. A couple of years ago I was in this exact same situation I'm about to tell you about and it was very depressing, it was hard and I didn't have a lot of guidance out there. I research on the internet and there wasn't really a lot of information the way that I went through it and eventually got a way out is what I wanted to share. I thought it would be a very necessary article because I can't find an article that would spell out to me the way am about to spell it out

1. Stop Using Your Credit Card Immediately

You can't get out debt while you're creating more debt, it doesn't make any sense. I know that not everyone can immediately stop but I'll give you two weeks, if you're really committed to it stop using your credit card, stop robbing Peter to pay Paul. The average credit card interest rate today is 15.07%, that means if you have a $15,000 balance across all of your cards and you're making the minimum payment of $600, that payment will decrease about $17 over the course of the payments that you make but it'll take you literally 162 months to pay that back, that's 13 and a half years. If you are 30 years old right now and you make the minimum payment. That's all you can afford, you're going to pay that off when you're 42 and a half years old. That sucks

2. Research Consolidation Loans

This isn't a paid sponsorship but I did use Lending Club, you can use whatever is best for you but that gave me a lot of flexibility in the range. When you're researching a consolidation loan there's a lot of articles that will tell you different things about it, check out some of them below

Things You Need To Know About Debt Consolidation

Debt Consolidation Advice To Get Out Of Credit Card Debt Fast

It's a personal loan that allows you to take all your credit card debt and pay them off, I get it that's also creating debt to get rid of another debt but what you're trying to do here is create positive expandable cashflow. Your goal here is not to pay off your credit card with the lowest interest rate, your goal here is to get the most positive cash flow, if I have lender "A" and I can get a loan of 9% at 36 months for $15,750, that'll make my payment $498.28

Action B, I can get 60 months at 12%, that will make my payment $345.23

That's the difference of $153.05/month, altogether if I take the lowest possible payment I can get I'll speed up $254.77 monthly for what I was paying from $600 before

3. Open A Zero % Intro Rate Credit Card

I know I just told you not to actually use your credit cards, but it's kind of irresponsible for me to tell you not to use your credit card at all especially in today's society you will need to refinance things, there's a high potential that things go wrong and we may not be able to immediately afford those things. Utilization is probably one of the most impactful things and if you don't use it, it kind of negative against you, so use your credit card keep it under 10 percent but open up with zero interest rate so that you're not carrying any interest rate with that card

4. Refinance Everything That You Can! Cars, Homes Loans, Credit

A great benefit toward consolidation loans or personal loans they're seen as installment loans once you get all your credit cards paid off your credit should jump through the roof, I mean high utilization can drop your point down a hundred points alone and if you get that utilization back down to 10 percent, you should see the opposite effect of it jumping up 10 point

  • At this point you're going to take advantage of your great credit, you need to refinance everything that you can, all your installment loans you need to redo your car payment if you can get a better rate on it

Redo your insurance that's affected by your interest rate, redo everything that you can, and create more cash flow. During this time, you should see what actually happen two months after you pay off all your credit card debt with a consolidation loan. What you want to do here is also to contact those credit cards that you just paid off, you are going to call every last one of them and you're going to ask for a credit line increase

  • You're going to ask them to give you more credit this is going to be instrumental later down the line, typically if your credit score goes up they'll allow that to happen

How much credit line should you ask for, ask for as much as possible and you're going to repeat this process every six months, usually companies will allow you to get an increase of credit every six months, during this time you're going to keep your utilization low on that 0% interest rate as much as you can. You should consistently do this so two months after increasing your credit, six months later increase your credit again, 6 months after that increase credit again


I refinance my car literally four times in one year, I've actually gone from Capital One credit card to the USA, back to Capital One, back to USAA. It's all about getting the best deal for your money, utilize the credit that you have and if it can save you $15 a month every time that you do it and it's going to keep the same terms, why not do it

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