2006-09-15 08:38:07 · 5 answers · asked by hollyhobby 1 in Business & Finance ➔ Credit
4% of your balance
So far, MBNA, Citibank and Bank of America have announced they are doubling minimum monthly payments on credit card balances from 2% to 4%. Others are expected to follow suit quickly. To some cardholders, that could be seen as a good thing. To others it could be devastating.
If you can handle the increased payment it's good. Let's face it, if you pay only a 2% minimum each month, your debt would probably last longer than most marriages. Doubling your minimum might put you back on the financial straight and narrow. Ostensibly designed to help consumers get out of debt faster, the increased minimums will force cardholders to pay off fees, interest and at least a portion of the principal each month.Find a loan that's
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But if you simply can't make that doubled minimum month after month, it could put you and many other debtors in over your head.
Why it's happening
Over the past few years, low minimum payback rates of between 2 and 2.5% have encouraged Americans to spend, spend, spend -- and to rack up an average credit card debt of close to $10,000 per household. For the estimated 40% of cardholders who carry a balance from month to month, the low minimums free up cash. But paying off a big charge little by ever-so-little also means that a $1,000 debt can turn into a 22-year commitment -- and that you'll accumulate thousands more in interest in the meantime.
2006-09-15 08:39:30 · answer #1 · answered by god knows and sees else Yahoo 6 · 0⤊ 0⤋
I hope you know this but just in case you don't..If you pay only the minimum payment on your CC debt you will be paying off mostly interest. You will be in debt for a long long time. Even if U only pay 5 or 10 dollars a month over the minimum, You will be saving a lot of money and the hole you are in will get smaller not bigger..The CC game is all about minimum payments and late fees. They count on these things for the real profits..let the buyer beware
Good luck to you..
2006-09-15 15:54:59 · answer #2 · answered by Patrick C 2 · 0⤊ 0⤋
usually about 3-4% of your balance is the minimum required
2006-09-15 15:46:02 · answer #3 · answered by priyapriteshpatel 3 · 0⤊ 0⤋
There is a great website that has tools to figure this out; you just enter your info and it calculates it for you.
www.crown.org
2006-09-15 15:46:38 · answer #4 · answered by peachiegirl 2 · 0⤊ 0⤋
if you're paying the minimum, cut them up now, you're in big trouble.
2006-09-15 15:43:05 · answer #5 · answered by Susan 2 · 0⤊ 0⤋