Let’s turn our attention now to some of the options you have to eliminate your credit card debt. One straightforward way is to create a monthly budget that takes into account all of your liabilities and assets (including taxable income) and then dedicates a set amount of money per month to getting out of debt. You can engage in self-debt consolidation by moving some money around, pooling money from savings to pay off a particularly high interest credit card, for instance.
Over time, as long as your budget allows you enough debt consolidation money to pay down the principles as well as the interest your debts are earning, you can become debt free. The only drawback here is that, if you need to make a large purchase, you may be unable to do so at great rates if you’re drowning in creditor obligations.
You can try negotiating directly with creditors or mediating a negotiation through a third party. While not all creditors will consent to reduce your rates or let you off the hook for some of your debt, negotiation is often worth a shot, particularly if you’re haggling over a small matter. After all, small bad marks on your credit reports can lead to lowered FICO scores and consequently higher interest rates later.
Alternatively, you can take out a debt consolidation loan. There are plenty of Internet companies which can provide debt consolidation services for you without lots of underwriting hassle. Be aware that not all small online firms are reputable, check with the Better Business Bureau to authenticate any potential debt consolidation partners. Alternatively, you can take out debt consolidation loan through your bank or funnel stored up home equity into a debt consolidation agreement.
Be sure to understand all of your budget implications as you move the money around. In addition, realize that, unless you’re on a fixed income, the time that you spend doing debt consolidation work is time that you could otherwise invest in your small business or enterprise, thus your budget should reflect at least to some degree how much your time is worth.
Another way to obliterate credit card debt is to fight it. If you believe that you’ve been unfairly charged for services or inappropriately targeted for higher rates, you may have recourse, both through internal credit card company processes and through state, local, or federal law. While it’s unlikely that you will win a major lawsuit against a credit card company, you may be able to latch on to a class action suit.