As one of the most expensive unsecured loans, credit card debts are notoriously known to be the main cause of debt issues in many cases. If you are no longer able to repay your credit card debts, there are a number of debt repayment solutions you can consider. In this article, we are going to discuss some of the most beneficial solutions to use briefly.
Let’s start with IVA or Individual Voluntary Arrangement, shall we? If you are suffering from a severe debt problem, signing up for an IVA program may be the best way to go. The program is set for five years, during which you pay a fixed amount of money towards repaying your unsecured debts including credit card bills. At the end of the five-year period, the court will write off your debt and other remaining bills, allowing you to enjoy a fresh start and the long-awaited financial freedom.
For moderate credit card issues, you can also use a good debt management plan as a solution. Unlike IVA, debt management plan is usually privately managed by financial institutions specializing in debt repayments. When you first sign up for a debt management plan, an experienced financial advisor will be assigned to you. The advisor will then review your personal financial state, determine the amount of money you can afford to spend each month on debt repayments, and negotiate settlements with your existing lenders.
Minor credit card debt issues can be solved by consolidating your credit card bills. There are a lot of options to look into when it comes to debt consolidation. Using a secured consolidation loan, you can combine multiple credit card debts and other unsecured loans into one manageable consolidated loan. Not only will you be making the process of repaying your debts much more manageable, you can also reduce the interests and other charges you have to cope with substantially. Don’t hesitate to negotiate better settlements and get up to 70% of your existing debts written off automatically.
With these solutions to choose from, there is no doubt that you will be able to solve your credit card problems without hassle. If you are dealing with an even more severe debt issue, you can also consider bankruptcy as a last resort. You will have to file for bankruptcy and complete the necessary steps before the court writes off your existing debts – including credit card debts – but you will be able to have the problems solved after completing the process. Again, use bankruptcy as a last resort when none of the other solutions are applicable.
Start by analyzing the bad debts and unpaid loans you still have to cope with and separating secured loans from unsecured ones. You can then prioritize loans that need to be repaid first based on the principal amounts and interest rates – or APR – before deciding the most suitable repayment solution to use based on the situation you are dealing with. You will be able to solve your credit card problems in no time with this approach.