What Is Credit Card Debt Relief?

Approximately 79 percent of Americans have at least one credit card in their name. Although most people with credit card debts intend to repay them quickly or at least on time, financial setbacks such as high interest rates and the sudden loss of income may lead to them falling behind on payments. 

Fortunately, top debt relief programs may be able to help. If you’re wondering “What is credit card debt relief?” Here’s a brief introduction to the concept. Also, there are some helpful strategies you could use if you’re struggling with credit card debt.

Credit Card Debt Relief Explained

Credit card debt relief refers to paying off or reducing credit card balances. With the help of professional programs or organizations, debtors can manage their debts, consequently minimizing the impact of interest and late payment fees. Below are some top debt relief programs you can use if you’re looking for ways to reduce your credit card balance. 

Credit Card Debt Relief Options

There are different ways to clear your credit card balance. However, beware that not every debt relief program may be the best option. Because of that, you should thoroughly research before deciding which may be the most appropriate solution based on your current financial situation.

Reach out to Your Lender

Before moving on to more complex credit card debt relief strategies, contact your lenders to check whether they’d be willing to assist you throughout the process. The Consumer Financial Protection Bureau claims that some creditors may be willing to lower interest rates, relinquish certain fees, or match monthly due dates with when you’re getting paid.

To get started with this strategy, use the contact information on your billing statements to initiate a conversation with your credit card company. Explain to them the various reasons why you’ve fallen behind with your payments and suggest options you’re pursuing to remedy the situation. Eventually, request them to help your cause by lowering your interest rates or waiving specific fees. 

Meanwhile, it would be best to remember that credit card companies aren’t necessarily supposed to waive fees or reduce interest rates. Also, they may ask you to pay a large sum of money within a certain period in exchange for waived fees or a reduction on the remaining balance.

Debt Settlement

Often a poor choice compared to other top debt relief programs, debt settlement involves negotiating with your creditors to pay less than what you owe. The negotiations are often coordinated by a third party – debt settlement companies – which handle communications between you and your credit card company. With this strategy, you’ll stop paying your credit card company directly and instead pay the debt settlement company, which in turn offers a copious amount of money to appease your lender.

Balance Transfer

You can consolidate your credit card debt through a balance transfer. However, this strategy may only be effective if you have a good credit score. Eventually, it could help minimize your debt and interest payments without negatively influencing your credit history. 

You can start by transferring your balance to a credit card in your name with lower interest rates. Move the balances to the new account and try to pay as much money as possible to regulate interest rates. If that’s not possible, you can also make little payments consistently until you’re in a position to pay more. Beware though, there are fees associated with balance transfers. Once the promotional interest rates are done, the ones that come afterward may be higher than what you were paying initially. 

Credit Counseling

Credit counseling can be a viable option for those seeking top debt relief programs. It’s typically coordinated by professional organizations that are often non-profit. Credit counselors can help you obtain copies of your credit report and scores, budget your expenditure and debt payments, and create a personalized debt management plan. They also offer advice to help you with debt and money management. 

In a Nutshell

Now that you know the answer to, “what is credit card debt relief?”, you should research all the top debt relief programs extensively to ensure you make an informed decision. The staff at Freedom Debt Relief can offer professional help for that.