- Check out the reason you are missing payments, or struggling to make payments
- There are various debt consolidation programs to help with credit card debt.
- Debt Settlement is a good option for those in financial hardship.
I have 2 credit cards that I can not make payments on. I am struggling to make payments and need help.
I have 2 credit cards that I can not make payments on. I would like to clear this problem up but I don't know what's the best solution. My credit has always been good. Just recently I have had some unexpected bills to come up so therefore could not make my credit card payments. Can you guide me in the right direction?
Why Do You Need Help with Credit Card Payments?
Thank you for your question about getting help with credit card payments. The good news is that there are various credit card consolidation programs, including those for people who are suffering financial hardship and struggling to make credit card payments.
It is good that you are proactive and looking to deal with your debt problems. While making late payments will hurt your credit score, you are correct in focusing on finding the best way to consolidate your debt. Once you are back on track, you can start to rebuild your credit.
Your first order of business is to determine why you need help? Are you suffering a small problem or a more significant financial hardship? Do you have an emergency fund, investments, or an asset, such as a home with equity, that can help you ride out the difficulty?
Short-term Hardship - Easy Help with Credit Card Payments
If your problem is short-term and you still haven’t damaged your good credit, then consider looking for a personal credit card debt consolidation loan. Since personal loans are for 2-5 years, check to see that you can afford the monthly payments.
If you own a home, have equity in your home, and a credit score of at least 580-620, the consider consolidating your debt with a cash-out refinance or home equity mortgage. A 30-year loan can consolidate your credit card debt into affordable monthly payments, which allow you to make timely payments and improve your credit.
A third option to help you make your credit card payments is to take to a credit counseling service. You can get help with your budget and analysis your overall financial situation. For some people, a debt management plan helps lower credit card interest rates and create more affordable payments. However, since the proa Debt Management Plan is for about five years, check to see if you can afford the monthly payments.
Financial Hardship Programs to Help Pay Credit Cards
If you are in serious financial hardship and can’t afford your minimum monthly payments, then you need to look for a more aggressive credit card consolidation program. Instead of continuing to make your unaffordable credit card payments, debt settlement companies negotiate lump sum settlements with your creditors, frequently reducing your debts by 50% to 60% of your principal balances.
Debt settlement programs usually take only 2-4 years to complete, so this is a good option for many people to rid themselves of debt in a relatively speedy manner. Stopping payments to your creditors hurts your credit, however, if you are already missing payments, then your credit score already is dropping. If you are focused on getting out of debt, then a debt settlement plan is a good option for those in financial hardship. Once you have your debt in control, you can rebuild your credit.
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Get Help With Your Credit Card Payments
Are you still not sure how to deal with your credit card payments? Did you already miss payments, or on the verge of missing payments? Use Bills.com innovative tool, the Debt Navigator to get a personalized analysis of ways to pay off your credit card debt.
If you are struggling with debt, you are not alone. According to the NY Federal Reserve total household debt as of Quarter Q2 2022 was $16.15 trillion. Student loan debt was $1.59 trillion and credit card debt was $0.89 trillion.
A significant percentage of people in the US are struggling with monthly payments and about 26% of households in the United States have debt in collections. According to data gathered by Urban.org from a sample of credit reports, the median debt in collections is $1,739. Credit card debt is prevalent and 3% have delinquent or derogatory card debt. The median debt in collections is $422.
Collection and delinquency rates vary by state. For example, in Texas, 15% have student loan debt. Of those holding student loan debt, 9% are in default. Auto/retail loan delinquency rate is 6%.
Avoiding collections isn’t always possible. A sudden loss of employment, death in the family, or sickness can lead to financial hardship. Fortunately, there are many ways to deal with debt including an aggressive payment plan, debt consolidation loan, or a negotiated settlement.