Want to know how to eliminate credit card debt legally? Easy.
Pay off the balance.
OK. All joking aside, I think it’s pretty obvious how to eliminate this debt legally. But when you involve multiple cards, different balances, and various interest rates, it can get a little confusing on what approach to take. We recommend these steps:
1. Do not close any credit card accounts!
Closing your credit card accounts can hurt your fico score…and quite dramatically. When you close an account, you lose all the credit history behind that card. No credit history is only slightly better than bad credit history.
Keep all major credit card accounts open so you can rebuild your credit. However, an exception to the rule is to close all retail account cards (i.e. Best Buy, Victoria Secret, Sears, etc.). This will actually help your credit.
2. Cut up all cards but two credit cards.
Ensure that the two cards you have intact are major credit cards (i.e. American Express, Visa, MasterCard, Discover, etc.) From now on, all future charges are to be made only on these two cards. Every month, pay off the monthly activity on your primary cards in addition to the minimum monthly payment. This gets you into the good habit of paying off the monthly activity.
Which cards you choose for your primary charges is up to you. You can base it on interest rate, rewards, vendor acceptance, or any other factors.
Now, if you cut your other cards, be sure to have the account information on hand somewhere else. (You really don’t have to cut them up…unless it just makes you feel better.)
3. Focus on the card with the highest minimum monthly payment.
Dave Ramsey says focus on the card with the lowest balance and pay it off first. Others say to focus on the card with the highest interest rate.
But remember, the name of the game is cashflow. So, I suggest focusing on the card that has the highest minimum monthly payment. I think it’s best to put your attention on the card that is affecting you the most in your monthly cashflow. Get rid of the liability that’s taking the most money from your pocket.
4. Find $100-$200.
Now, I don’t mean go look for loose change in your couch. Find $100-$200 in your budget (or adjust your budget to make it available) and put it towards the card with the highest minimum monthly payment found in step 3. This is to accelerate paying off this credit card. But don’t forget about the other cards. Continue paying just the minimum balance on them.
Of course, if you can always put more towards the payment. The more the better.
5. Lather, rinse, repeat.
Once you have paid off the card with the highest minimum monthly payment, you’ve just learned how to eliminate credit card debt legally.
Now, move onto the next card that has the highest minimum monthly payment. To that card’s payment, add the amount that you were paying on the previous card. Repeat this process each time a card is paid off. This is often referred to as the snowball technique.
6. Pat yourself on the back.
Be patient for this can be a long process. Celebrate each time you accomplish paying off a credit card. Whether it be a pat on the back or a nice dinner, congratulate yourself because working to eliminate credit card debt legally isn’t easy.
Remember, once you’re done, do not close any credit card accounts!
Part of developing your millionaire mindset is taking accountability. If you got yourself into consumer debt, you should be the one to work to get yourself out.
Believe you are able to do it. Once it happens, you have developed the discipline, focus, and energy to achieve greater goals. How about financial freedom?
Oct 24 2010
How to Eliminate Credit Card Debt Legally
Sep 01 2010
Legal Credit Card Debt Elimination
Legal credit card debt elimination is an unsecured program for credit card debt elimination. There are many legal agencies, which provide you the facility of eliminating your credit card debts.
Legal debt elimination agencies help you to get out of your debts by negotiating with your card provider to get a reduced balance, which you would be able to pay off in a reasonable amount of time. But most legal credit card debt elimination programs may result in negatively affecting your credit history.
Legal credit card debt elimination helps you to eliminate your debt much more quickly, usually within 90 to 120 days. Most agencies will demand you to minimize your credit card use during the period of debt elimination. Some agencies recommend to eliminate the credit card debts with the highest interest rates first. Others may recommend to eliminate those with smallest balances first.
Legal credit card debt elimination programs usually cover all unsecured credit card debts such as those with Visa, MasterCard, Discover, and American Express cards. Department store debts, gas station charge cards, and secured loans such as home, auto, and boat loans, and student loans are often not covered under this process.
Getting legal credit card debt elimination is a difficult and lengthy process. There are many types of credit card debt elimination plans. It is helpful to have short-term and long-term goals in mind before you go for debt elimination. Before signing a contract ask contacting creditors for a lower interest rate. Remember that usually you are not permitted to engage in any new obligations after a credit card elimination process has started. You also have to make your minimum monthly payments on time to the credit card company until the debt is eliminated.
You have to beware of credit card debt elimination programs that are illegal and charge an interest. According to federal and state usury laws charging interest on credit cards is illegal.
Apr 29 2010
Using Credit Cards in Dubai for A Great Shopping Experience
All over the world, Dubai has come to be known as the perfect holiday destination with skyscrapers on one side and Gulf coast on the other. Development in the region took such a sharp turn that the area has become economically advanced and has some of the best hotels, shopping malls, cruise ships, theme parks and many more things to enjoy the vacations. Tourists, from almost every country, turn up at different locations of Dubai and indulge in sightseeing and shopping, the latter being a big reason for the trip.
Shops of all varieties are present in these malls and products of every kind are available in these shops. With people visiting from every country, credit cards are the usual means of financial transactions in the shops. Since credit cards belonging to Visa, Mastercard, Diners, American Express, etc are allowed in almost every shop, tourists do not face difficulty when they arrive here for their vacations.
People can even pay with credit cards at the restaurants, parks and other ticket bookings.
This is the charm of vacationing in Dubai as credit cards Dubai are prevalent everywhere and for everything. People do not carry loads of cash or currencies anymore, if they go for shopping thrills. Starting from renting cars to visiting one’s favourite theme park, from relaxing in a lounge bar to paying for the shopping of jewelleries, everything is possible with the credit cards issued by various banks.
Another factor that has added to the frenzy of credit card usage is the universal acceptance of these cards with Visa, MasterCard, diners and American Express labels on them.
Almost all places readily accept these cards, allowing the liberty to tourists to go to any place and enjoy every experience in Dubai. Further fuelling the use of Dubai credit cards is the number of offers that one can find when people do their financial transactions through these cards.
There are plenty of shops and restaurants where life points can be availed of, if the payment is being done through these cards. This is because of the tie ups of the banks issuing the credit cards with a number of business establishments. This again is a lucrative offer for the shoppers and tourists to go for shopping in various places in Dubai. Earning these points finally leads, indirectly into conversions to money.
Cash back offers are found in some of these cards, depending on the card membership types. One could be a gold member or platinum member, decided by the amount of maximum transactions possible. Apart from the tourists, credit cards Dubai have become a major form of shopping transactions for the local people also, who are using cards issued by banks in the region itself.
Mixed with various offers and shopping discounts or cash back options, Dubai credit cards have come as a great means of enjoying the trip to one of the most developed cities in the UAE. Memberships, universal acceptability, usage in variety of places and the possibility to buy anything and everything has brought the credit cards into focus in one of the best places for vacationing in the world.