Do you have credit card debt that you would like to reduce or clear? It can be easy for the balance on your credit cards to quickly mount up, leaving you with large debts and a lot of stress.
Is there a way out of these growing debts and an escape from the anxiety brought on by owing money to your credit card company?
Yes! The good news is that there are some things that you can do to reduce or even clear your credit card debt by using the equity that you have in your property. Knowing how to pay off credit card debt can empower you to take control of your borrowing.
Here at The Mortgage Broker we have a proven track record of helping our customers consolidate their debts find financial solutions even if you have debt or bad credit. For some free, friendly advice on how to pay off credit card debt, contact us and let us know how we can help you.
Are You Looking for a Way out of Your Credit Card Debt?
Having credit card debt can be worrying and stressful, making you feel like there is no way to reduce your debt.
Sometimes the borrowing on your credit card can get to a point where you have a large balance, you are only making the minimum payment each month and your credit score has taken a nosedive too.
If you are in this situation then you may be wondering;
- How to pay off credit card debt if you have bad credit
- Can I borrow more on my mortgage to pay off debt?
- Is it a good idea to remortgage to pay off debt?
- Is it better to get a loan to pay off credit card debt?
- Is a loan better than credit card debt for credit score issues?
We’ll help you understand the options available to you for remortgaging, so you can use the equity in your property to help reduce your monthly outgoings, , such as; getting a credit card debt consolidation loan, remortgaging to pay off your credit card balances, and more.
We’ll also look at the pros and cons associated with the different options you could choose and give you the information you need to know how to pay off credit card debt.
How to Spot if You’re Having Problems With Credit Card Debt
Having a credit card can be a really handy way to make purchases immediately, rather than having to save up for them., and to be able toYou can also make payments over time rather than straight away.
You can also help build your credit score by using credit cards. If you pay your monthly balance in full, then you won’t have to pay any interest and you will continue to boost your credit score as you are showing creditors that you can use the credit card and clear it each month. However if you are not able to pay your credit card in full each month, this can reduce your overall credit score.
However, the downside of having credit cards is that you may be tempted to overspend and overstretch your finances.
Some indications that you may be heading for trouble with your credit cards include:
- Being at (or close to) your credit card limit (or close to)
- Having multiple credit cards with a large balance on each
- Only making the minimum payment each month
If you find yourself struggling – don’t panic – because there are steps that you can take.
Learning how to pay off credit card debt can give you the power to get your financial situation back under control.
How To Pay Off Credit Card Debt – First Things First
So you’ve decided that enough is enough and you want to get a handle on your credit card borrowing. Here are some good first steps and options to consider:
- Make a calculation of what you owe.
Facing the balance of your debt is a good starting point and gives you an idea of what you’re dealing with. Add up the balance owing on your credit card/s and work out how much interest you are paying over and above the balance.
- Are you just making minimum payment/s?
If you are currently just making the minimum monthly payment/s then this isn’t helping to reduce your debt, and that can be demotivating. If you are able, try to create a fixed amount to pay each month, that way your balance will start to go down and become more manageable over time.
- Try to avoid using your cards
If you continue to use your credit cards then your balance will remain high or become even higher. Reducing the balance and not adding to your debt is essential if you intend to get yourself out of debt.
- Use your savings to pay your credit card balance
If you are looking for how to pay off credit card debt, using your savings is worth considering. If you have savings then you may be reluctant to use those funds to pay debt off your credit cards, but making that hard choice may be a good option in the long run. If you are able to clear your credit cards by using your savings then you will save having to pay all the extra interest over the life of your cards. It can also be a weight off your mind to not owe large sums on your credit card accounts.
- Move to a 0% balance transfer card
If you have credit cards with a high interest rate, then moving the balance to a 0% card can be helpful. With a 0% credit card you wouldn’t have to pay any interest for a set period of time, allowing you to start the process of getting your finances under control.
Your credit score will probably affect whether you can get a 0% card or not, but if you are unable to transfer to a 0% card due to bad credit, you may still be able to move to an interest rate that is lower than you are on currently.
However, if you are looking to clear your balance and want to know how to pay off credit card debt completely, here are some alternatives:
Using a Personal Loan To Pay Off Credit Card Debt
If you are wondering about other options for how to quickly pay off credit card debt, then getting a loan could be a way forward for you.
Even if you have a poor credit score there are available loans to pay off debt with bad credit.
The idea of using a loan to pay off your credit cards is that you would consolidate your debt into one loan, ideally with a lower interest rate, and make regular monthly payments over a set period of time.
The advantage of transferring your credit card debts onto a loan are that your card balances would be cleared and you would have a smaller monthly payment where your balance is repaid over time.
There is no obligation to close your credit card accounts but try to avoid the temptation of racking up fresh debt once they have been cleared.
Can You Remortgage to Pay Off Debt?
An alternative course of action for how to pay off credit card debt would be to apply for a remortgage. If you choose to go this route then you would effectively clear your credit card balances and the debt would go onto your mortgage.
There are pros and cons to doing this with the main advantage being that your debt would become spread over a longer period of time and thus more manageable.
Summary
If you are struggling to know how to pay off credit card debt then there are several possibilities for you to consider.
Seeking advice from a professional can help you navigate the options available to you. For some free, friendly advice on how to pay off credit card debt, give us your details and we will arrange a callback at your convenience.