How do you get out of a credit card debt if the sum of your minimum payments exceeds your actual balanace?

Question

I owe $5,000 on 1 credit card and probably paid $7,000 in interest and fees over the years but still carry nearly the same balance at a high interest rate - makes it hard to pay off. Ideas? Tricks? Tips?

Answer 1

Also make sure you're paying well in advance of the due date. Companies love to get you by charging outrageous late fees. When you get your plan in place use a bill pay service to ensure your payments arrive on time.

Answer 2

generally a minimum payment is computed to be about 1% of the balance. With a high interest rate you're probably accumulating additional interest debt that your minimum payment does not keep up with. Minimum payments are not determined with the consumers best interest in mind. They are computed to earn profit for the bank or lender. What that means is that at the rate your going you will never pay your account down. If you have good credit with your company (no late pays etc.) call them and ask for a reduced (preferred customer) rate. You may or may not get this consideration. Regardless, it is imperative that you pay every month as a minimum the entire accumulated interest for that month plus whatever you can afford on the running balance. Do this regardless of the minimum payment. This will allow you to begin to realize a reduction in your overall balance. Remember credit card companies are nice guys in that they front you money so you can buy now and pay later. But those nice guys are keeping you chronically indebted to them unless you reduce and eliminate that debt. DO NOT play the minimum payment game. Good luck.

Answer 3

paying the minimum is what they want you to do.
THey find an upstanding person like you (who wants to do the right thing and pay his/her bills) and then they tell you all you have to pay is $25.00 A MONTH or whatever amount..hoping that you have so much going on in your life that you wont notice that you are not paying much towards your balance because the interest payments are gulping it up.....
Now that you have caught on, the first thing that you is decide exactly how much more per month you can pay and pay that.
If you have some extra stuff laying around the house that you can sell on ebay, DO THAT...take that money and pay it towards your card. This summer, can you mow a few lawns or have a garage sale. what about a second job?
Do you expect an income tax return for this year....how about donating that windfall to your credit debt.
Basically I am saying whatever extra money you can find, pay it on your card.
Secondly,
CUT THE CARD UP
dont save it for emergencies
just cut it up
dont use it again
Each time you pay more than the minimum on that card, you are giving the credit card company the middle finger....
they dont like this so if you do it consistently, they will send you free checks, they will increase your credit card limit
offer you teaser junk etc.
Ignore it and just keep paying what you can.
Skip work lunches and bring food from home a couple of times per week and send the difference to the credit card people.
Make a budget at the grocery store and stick to it
YOU can do this and you can find your own ways to cut corners.
GOOD LUCK

Answer 4

Minimum payment guidelines are governed by the OCC, a federal government agency. They are not a trick by the banks to make more money. They are just that a guideline. Within the last two years the government mandated that banks raise minimum payments so consumers pay down their debts sooner. The result, your minimum due is higher, whether you can afford it or not, and you have no choice as you did before to pay more or less. It caused an onslaught of people who were already overextened, their fault, to not be able to pay their minimum due, the governments fault. Your minimum payment and interest rate was disclosed in your contract before you charged one cent. I am so sick of the "I'm not responsible for my own ignorance and actions" attitude that some of the others who have answered have.
You seem responsible and ready to take action to remedy your situation. Consumer Credit Couselling Service is a non-profit organization that provides debt counseling and education. They can work with your creditors & negotiate smaller payments and reduced interest. You can find them in the yellow pages.

Answer 5

First, stop using all credit cards until you are out of this hole. Next, if you can, get a lower-interest LOAN from a bank or CU to pay off the credit card company. The loan rate, even if you are fairly high risk, will be far less than the CC company.

If tyou CAN'T get a loan, pay as much as you can possibly pay until it is paid off, even if you have to tighten the belt for a year or so. You will NEVER pay it off by paying the minimum!!

Answer 6

If a person has accumulated a large amount of credit card debt due to multiple credit cards, the need for a proper counseling for credit card debt consolidation can't be understated. Credit card debt consolidation counseling helps a person get vital insights into the facts that can help him get control over the credit card debt.

Credit card debt consolidation counselors are experts with a good knowledge of debt management, budgeting and behavioral patterns of credit card holders. These services are vital for those struggling to manage their credit card debts. Also called credit counseling or debt counseling the credit card debt consolidation counseling brings immediate relief to a credit card holder.

A person seeking credit counseling can get it from two types of organizations. The professional or commercial organizations, and the non-profit organizations. As depicted by its name or categorization, the commercial organizations charge money for their credit counseling sessions and consolidation help on the other hand the non-profit organizations offer free of charge services. Just because the non-profit organizations are free, it doesn't undermine their quality of service. The persons associated with such organizations are thorough experts and have lived the trauma of being under credit card debt themselves and hence bring their vital experience to the credit card holder. Read more from: http://www.credit-card-gallery.com/article/353,Credit_card_debt_consolidation_and_credit_counseling_great_tools_to_get_rid_of_credit_card_debt

Answer 7

Get a personal loan from a bank, at a lower interest rate. Pay off the credit card, and then chop it inot little peices.

Answer 8

Go to a company that specializes in helping you get rid of creit card debt. They will work with your creditors to get a reduction in monthly payments to a level you can manage. You make one payment to that company, they distribute the money to your creditors. Bring your credit cards with you and be prepared to cut them up when you have your first meeting with the company. You CAN actually live without them and you MUST get rif of them if you are serious about getting out of debt.
As with most things in life, it will take longer to get out of trouble than it took to get into trouble.