I am struggling with credit card debt. My biggest debt is my Bank of America account that I owe $14,000 on. My total debt is closed to $30,000. I am not late on any payments, but am barely getting by. I've been using my cards to cover some of my basic expenses and am getting close to maxing out my accounts. I know I can't hold things together much longer. I need help. Is there a Bank of America debt consolidation program that would help me? What do you suggest?
Thank you for your question about your credit card debt, specifically your Bank of America credit card debt, and whether there is a Bank of America debt consolidation option or other solution that will help you.
Bank of America is a full service bank, offering a variety of services including checking and savings accounts, credit cards and a Bank of America mortgage department. Bank of America debt consolidation loans are also available, although they require strong credit and income and generally come with high interest rates.
Whenever you are experiencing financial strain, it is worthwhile to contact your creditors directly, before you miss any payments. In your case, you should call Bank of America and your other creditors to find out if they offer a financial hardship program that could give you some temporary relief. You may get an interest rate reduction or permission to make a smaller than normal minimum payment, without suffering late fees or a hike in interest rates.
If your credit is in good standing, you can look into a balance transfer offer as a debt consolidation solution, working to move as much high interest debt as you can into a lower interest rate. Keep in mind that balance transfer offers come with a low 'teaser rate' that will adjust into a higher rate, once the introductory period ends. It is your responsibility to know how long the low rate lasts and what rate you will pay once it adjusts.
If BofA or your other creditors are not willing to work with you, you may need to seek help from some type of professional debt relief organization, whether a credit counseling firm or a debt settlement firm. It's valuable to know how you creditors work with their customers, so you can plan an effective strategy for getting out of debt.
Based on research done by Bills.com's editorial staff, here are some specific facts about Bank of America and how it deals with accounts enrolled in debt relief programs.
If you enroll a Bank of America account in a credit counseling firm's debt management plan (DMP), you should expect:
Debt settlement is an option to consider, if you are experiencing a financial hardship. Debt settlement is an aggressive form of debt relief designed to get you out of debt in 24-48 months, provided you can make the monthly program payment.
Bank of America is willing to negotiate settlements in many instances. Based on an audit of hundreds of Bank of America settlements negotiated by professional debt settlement negotiators, the average settlement negotiated was in the range of 50% of the balance clients enrolled in the settlement program. While an individual can try to negotiate settlements with his or her creditors, many people find that it is well worth paying fee for a reputable and experienced settlement company.
Make sure to find a debt settlement company that does not charge you any up-front fees and is fully compliant with FTC regulations. Bills.com recommends choosing a firm that is a member of the AFCC (American Fair Credit Council) and whose debt consultants are accredited by the IAPDA (International Association of Professional Debt Arbitrators).
Bank of America is not the most aggressive creditor, when it comes to taking legal action against delinquent debtors. Bank of America usually waits nine months after the first delinquency before referring its accounts to outside legal collections. Not every account that is 9 months late will be sent to collections. Bank of America reviews the size of the account balance owed, the state collection laws, and whether the debtors employment history and assets make collection likely.
Bills.com recommends that you look into all your debt relief options, before making any decision, in order to weigh all the pros and cons. Use Bills.com's free Debt Coach tool, which was positively reviewed by the New York Times and by CNN. You can easily review your available debt options, based on your priorities for getting out of debt, and receive a solid idea of what your total costs will be.