Using Credit Card is Better Than Debt Relief

1
Whether Using Credit Card Is Better Than Debt
Relief To Pay Off A Debt
www.basicfinancecare.com
2
Most people use their credit card to pay of a
debt whether it is a medical debt or any other
without realizing the consequences of it. Credit
cards nowadays are issued and are available in
plenty. You will find a single credit card
issuing company offering a number of different
types of credit cards that have different credit
limits, names and most importantly different
rates of interest.
Inconsiderate and extensive use of credit may
reach to its limits making your financial health
and situation worse. Therefore, take out some
time to research and go through the pros and cons
of it before you hand it over the counter for
swiping in the Electronic Data Capturing device
or EDC.
3
Credit Cards and Debt Payments
It is best to use your credit to pay only short
term expenses. This means that you must use it
only for those expenses that you know and feel
that you can repay at the end of the monthly
billing cycle. This billing cycle may be
different for each card which is the primary
thing that you must consider to avoid
accumulating debt in the form of interests and
charges.
If you find that you do not have enough credit to
cover your bill you will have to consider other
options such as debt consolidation, debt relief,
and even debt settlement. Ideally paying off a
debt with your credit card may stop the calls
from the creditor or collection agency for a
specific debt but that does not mean you have
eliminated it completely. Ideally, it is just a
way to delay such calls as these will again
surface if you miss your credit card payment
which is highly on the cards and have all
possibilities.
4
Consider Different Approach
Consult with your creditors directly or through a
debt adviser, debt attorney or any credit
counseling agency. This will help you to find out
whether the creditor will allow and agree to an
interest-free payment plan. This will make your
debt more manageable than accruing interest on
your credit card due to non-payment.
If you take up a debt settlement program you will
pay far less than the actual amount you owe to
your creditor but for that, you will have to make
a lump sum payment one time. Whatever processes
you choose make sure that you have all your right
protected and also know that the process will not
cause any further problem in your debt free
journey. There are lots of regulations set by the
Fair Debt Collection Practices Act or FDCPA that
you must know so that creditor or debt collection
agency can follow any unfair practice.
5
Your Credit Score
It is your credit score that matters in the end.
Any debt going to collections will harm your
credit score by as much as 100 points. Moreover,
if you cannot repay any debt then this fact and
report will take seven years to disappear from
your credit history.
Therefore, the best way is to choose a federal
debt relief as the federal stimulus money will
give you more flexibility when you will negotiate
for a debt settlement with your creditors. The
creditors usually use the stimulus money as a
cushion and help you to eliminate a significant
percentage of your debt. You may pay it back in
one lump sum or even take up a payment plan.