DO you wish you had less credit card debt than you currently owe? Have you charged more than you can afford to pay? Are you frustrated with the fact that your balances never seem to go down after having paid religiously for years? Do you feel hopelessly trapped in credit card debt?
Credit cards are one of the easiest debts to obtain. Every year, the credit card companies send millions of solicitations in the mail, offering consumers “pre-approved” credit cards and credit line increases. Recently, a 72-year old senior citizen came to my office and told me that he had just been “pre-approved” for a credit card with a $12,000 credit limit. All he had to do was sign his name on the form and send it back. The problem is that this person has been living on social security for the last 6 years and has no more than $1200 per month in household income.
How in the world can someone who has had no more than $1200 a month in household income for the last 6 years qualify for a $12,000 credit limit? But the more important question is: “What was the credit card company thinking when they sent this “pre-approved” credit card to a person with very limited financial means? Where is the accountability here? Something is wrong with this picture.
I understand the need to handle credit responsibly. But when someone of limited financial resources is given an opportunity to spend their money (using a credit card) BEFORE THEY EVEN EARN IT, this can likely lead to FINANCIAL DISASTER! I make no excuses for anyone but the credit card companies should also take part of the blame because of their irresponsible lending practices.
And, of course, the outrageous interest rates on these credit cards are unbelievable. I had a couple in my office last week who hired me to help them do a Chapter 13 debt consolidation. My calculation showed that they would be debt-free in only 3 years and would only need to pay half of their total debt. Without Chapter 13, however, it would have taken them 32 years to pay off their total debt and would have paid more than $191,000 in interest alone over the next 32 years!!!!! Isn’t that ridiculous? A lot of people owe so much on their credit cards that they will never pay off what they owe in this lifetime! The sad thing is that THEY ARE NOT EVEN AWARE OF IT. Every month, they struggle to pay the minimum and don’t even realize that they WILL NEVER BE DEBT-FREE.
Lastly, a lot of people often “juggle” credit cards by using credit cards to pay other credit cards. Don’t be foolish. It is impossible to borrow your way out of debt. Much sooner than you think, you will be buried alive in debt. This strategy has never worked and never will.
If you are in debt, what you need is a debt repayment or elimination strategy that works. Find a way to reduce your expenses and use the money you save to pay your debts more aggressively. In some cases, selling unproductive assets may help. If your accounts are already in collection, debt settlement for less than full amount may be an option. For example, my office regularly settles debts for about 20-60% of the original amount.
Finally, remember that you have rights under federal bankruptcy law as a consumer that can help you either wipe out your debts completely or at least consolidate all your debts into one affordable monthly payment. After being a bankruptcy attorney for 9 years now, I find that most of what people have heard about bankruptcy is simply wrong. There is a lot of misinformation out there about bankruptcy these days and the people that are getting hurt are the people who desperately need debt relief. If you are one of these people, you need to find out for yourself what your legal options are by consulting with a knowledgeable and experienced bankruptcy attorney who can evaluate your case and recommend possible solutions. Don’t wait until things get worse.
For attorney free consultation, call Toll-Free 1-866-477-7772. We have offices in Pasadena, Valencia and Cerritos.
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None of the information herein is intended to give legal advice for any specific situation. Atty. Ray Bulaon has successfully helped thousands of clients in getting out of debt. For a free attorney evaluation of your situation, please call Ray Bulaon Law Offices at TOLL FREE 1 (866) 477-7772.
