Wednesday, February 20, 2008
Credit Counseling Often Forgotten Among Other Options
All of Wall Street is up in arms about the mortgage crisis. No one seems to ask why things have gotten to this point. They rightfully blame poor mortgage standards.
While the mortgage business is imploding, everyone is focused on the mortgage companies that are to blame. This is taking the focus off of credit card companies.
The drop in scrutiny on credit card issuers has resulted in higher interest rates, higher penalties and higher balance transfer fees. No one seems to notice that the terms on many of their credit card agreements have worsened over the past year. Such a trend is likely to continue.
One of the main problems with the current credit card problems many people are having is that these problems are spilling over into other areas of concern. It is hard to make a mortgage payment when your credit card minimum payments have gone up 20%. As a result, foreclosures are likely to increase at an even greater rate. Foreclosures in July 2007 increased over 90% from one year earlier.
As credit card debt has gotten out of control, many people have had more trouble making their house and car payments. When money gets tight, something has to give.
People are too quick to rush to file for bankruptcy in order to seek a quick fix to their financial troubles. Many of them could actually repay their debts over three to five years, and do so with lower payments and far lower interest rates. These are the types of assistance that can help distressed debtors get back on track with all of their bills.
Lower interest rates on credit cards are generally available if you can show that your financial situation is troubled. A credit counselor can help you develop a budget and analyze your debt load. They can help you understand your net worth and evaluate options that may be possible based on your own unique situation.
A debt management plan could help lower interest rates on your credit cards and provide you with a much needed break from finance charges. Even your minimum payments could drop substantially.
Find out from a credit counselor what options you have. It can frequently help you avoid going down the wrong path.
Kenneth Long began his public service with nonprofit organizations in 2001. He has since conducted workshops teaching other nonprofit executives how to integrate credit counseling with volunteer tax preparation programs. Long is a graduate of the University of North Carolina at Chapel Hill and received his Certificate in Nonprofit Management from Duke University.
You may find more information on lower credit card interest rates
