In the wake of the jump in defaults on subprime mortgage loans made
to borrowers with poor credit histories, banks have been less willing
to allow consumers to consolidate credit card debt into home equity
loans or refinanced mortgages. That is leaving some with no option but
to miss payments, economists said. Investors also are backing away from
buying securitized credit-card debt, said Moshe Orenbuch, managing director
at Credit Suisse. But that probably has more to do with concerns about
the overall health of the U.S. economy, he said. "It's been getting
tougher to finance any kind of structured finance -- mortgages, automobile
loans, credit cards, student loans," said Orenbuch, who specializes
in the credit industry. Capital One Financial Corp. reported that delinquencies
and defaults are highest in regions where troubled mortgages are concentrated,
including California and Florida.
He's got about $20,000 total outstanding on two credit cards, his wife's
line of credit is jacked up another $10,000 and he's paying double-digit
interest rates. With that much debt, it would seem like a no-brainer
that one of my good friends, who shall remain nameless, should consolidate
his debt. After all, he has close to $200,000 in equity in his home,
plenty of cash to pay down all those credit cards and lines of credit
that are costing him more than $400 in interest each month to carry.
"No, I'm not touching those at all. I'm gonna pay them down on my own,"
he told the bank manager who tried to advise him to pay off the credit
cards and tack the debt onto his mortgage. "If I pay off those cards,
I'm just going to rack them up again right to the limit." His addiction
to eBay and the fact that one of his cards is registered with an online
betting service have not helped him fight his growing credit problem,
but the bottom line is he know his limits -- certainly his credit limit.
The logic may seem flawed, but my friend is not alone in recognizing
the inherent problems that come with consolidating debt and paying down
credit cards. Credit counsellors say a significant portion of consumers
will simply max their credit cards back out again once they get the
balance down to zero.
So, you find that debts emerging from your existing credit cards are
wrecking your finances and pushing you towards bankruptcy. Simple, seek
another option, the credit card debt refinance one. This is a way of
transferring or consolidating all existing debts of your credit cards
with a new card with the help of a credit card debt consolidation company.
One more new card- wouldn’t that mean one more burden to take over?
Consumers under the immense pressure of credit card debts can actually
consolidate their total debt amount of existing cards to a new, single
card. Now, credit cards specially designed to refinance credit card
debt come at much lower rates. That gives you a low interest consolidation
loan to reduce your debt level.
What Is Credit Card Debt Refinance? With the credit card debt refinance
option, you can take the opportunity of using a credit card at an exceptionally
lower rate. There are several credit card debt consolidation companies
which offer cards at zero level of interest rate for a certain period
of time. For a specific number of months, you can transact and pay off
bills of those credit cards at zero percent interest rates before the
high interest rates begin. After you use this card with zero interest
rate payment term, you can consolidate credit card debt by transferring
or refinancing your previous credit card debt with a new zero interest
If you are looking out for a way to eliminate the mounting credit card
debts and regain control over your finances, credit card debt consolidation
might be an ideal answer for you. The credit card debt consolidation
loan carry virtually endless advantages, which can eventually help you
bid farewell to all your debt worries. Some of the advantages can be
described as follows.
When you are unable to pay a particular instalment for your credit
card loan, interest and other penalties are charged on you. This way,
the total amount of debts eventually becomes bigger and bigger. When
you go for a credit card debt consolidation through a reliable program,
the first thing it does is that it eliminates the accrued interest and
other financial charges. And, you are left with a much-reduced amount
that you need to pay. You can understand this with a simple example.
Suppose the original credit card debt that you owe is $5000, but since
you defaulted on certain instalments, the interest and penalties just
stacked over this debt and the eventual debt reached to $8000. It means
$3000 are just for certain financial charges. Now, when you go for a
credit card debt consolidation program, the first thing it does is that
it eliminates the debt to $5000, deducting the other financial charges.
When you apply for a credit card debt consolidation loan, you get the
valuable services of a debt counsellor. The counsellor negotiates with
your credit card companies and persuades them to substantially reduce
the rate of interest. The new interest rates that are much lower than
the earlier do not only reduce your overall debts but they also substantially
reduce the amount of the monthly instalments payable. Let me give you
an example. Suppose, you owe to three credit card companies and the
interest rate they charge are 16%, 14% and 12% respectively. This way,
the average interest rate becomes 14%. Now, the counsellor negotiates
with the credit card companies and turns up with a much lower interest
rate as 10%, 9% and 8%. This way, now the average rate of interest payable
is just 9%. You can see the substantial difference and the amount you
can save. Thus you come out that much informed from a session with credit
card debt consolidation counselling.
A bad credit report can ruin your financial life forever. Please do
not let this happen to you. If you have mismanaged finances for some
time, then look for a bad credit debt consolidation advice to get out
of your financial mess and get credit card debt relief. When you receive
service or cash on your credit card, it is your duty to keep the trust
of the creditor company and pay your dues on time. It is very necessary
to keep good credit. In today’s world, we can get everything on credit.
You simply cannot buy a car, a house, its furnishings, or even a computer
without credit. It is so easy to fall out of good credit as well. A
few late payments are enough to start the rot. It Is Time To Wakeup
Has your credit rating fallen lately? Have you been late on your payments
because of illness, injury or unemployment? When bad times befall good
people then help is available in the form of credit card debt online
counselors. You can also seek best credit card debt help online. Here
are a few tips on credit repair.