Too high credit card debt can be a serious problem. Of course, you have to find the way how to pay off credit card debt quickly before the interest rate is more and more increased. There are at least 5 solutions that can be tried. In this article, we will discuss each of them in more detailed explanation.
Lowering Interest Rate & Increasing Payment
One of the solutions how to pay credit card debt quickly is to lower the interest rate and increase the payment. However, you need a formalized budget. The benefit is that it can eliminate your debt within your own budget. Besides, it also does not require extra borrowing. But it depends on the willingness of creditor to reduce your interest rate. Anyway, it belongs to the most effective way how to pay off credit card debt quickly.
Using a Credit Card for Paying Debt
The second solution how to pay off credit card debt quickly is using a credit card. This way requires a balance transfer credit card. It is recommended because it offers 0% APR of promotion period with interest-free debt repayment. However, it has limited time for 6 to 18 months only. Besides that, you also must have good credit history. If you can meet the requirements, how to pay off credit card debt quickly can be done easily.
Loan for Paying off Credit Card Debt
It also belongs to the ways how to pay credit card debt where you need to get a loan. In this way, what is required is unsecured personal debt loan. What makes it recommended is that this provides low interest. However, you have to know that you must have good credit history. Besides that, debt to income ration should be 41 percent or less. If you meet those requirements, you can practice this good way how to pay off credit card debt quickly.
Getting Professional Help from a Credit Counseling Agency
The next idea is to get a professional help from a credit counseling agency. This idea requires a debt management program or also well known as DMP. This way may lower the total of monthly payment. However, the included credit cards will be frozen so that you cannot apply for a new credit when it is enrolled. Anyway, it is reasonable to be considered as one of the best ideas how to pay off credit card debt quickly.
Settling the Debt Less Than You Have
This is another way that you can try. In this case, you need a Debt Settlement Program or DSP. The advantage is to get out of your debt so that it becomes less than you owe. However, the debt that is settled will create a seven year negative credit card report.
From those solutions above, we can see that each of them has its own advantages and disadvantages. By understanding how to pay off credit card debt quickly above, you can decide to follow your desired solution.