Lots of us have too much credit card debt. Many of us are concerned about paying our debts with the many job layoffs and high expenses.

You'll have a big problem if you find yourself unable to make your credit card payments. Pay even one day late, and you'll see big late fees. Late payments can cause interest rates to rise, too. Late payments can also negatively affect your credit rating.

There are two important ways to take care of your credit card debt; consolidation and debt programs. There are some differences between the two programs.

Bank and home equity loans are the most popular way to debt consolidation loan. Loan proceeds pay off the credit cards, leaving you with just one payment a month. In most cases, the interest rate on your consolidation loan will be lower than the interest rate on your credit cards. This means that your consolidation loan payment will be less than the total credit card payments you were making each month, saving you money right away. In addition, the lower interest rate means that the loan will be paid off faster than you could have paid off the credit cards. Just remember not to use the credit cards anymore. Otherwise, youire left with a consolidation loan payment plus a credit card payment. If you've missed a lot of credit card payments already, your credit rating may be poor enough to keep you from getting a loan. It's best to consolidate early, before your credit rating is affected.

Debt settlement allows you to settle your consumer credit cards for less than you actually owe. You will work with a credit card debt settlement company who will write a debt settlement letter to each of your creditors on your behalf. You'll pay each creditor just a portion of what you owe.
You'll make only one payment per month. The new payment covers your credit card payments and paying the settlement company. The money will be distributed to the debt settlement company. This payment should be less than you were previously paying.


Debt settlement is not for everyone. Your credit will be affected. However, your credit may have already been affected by your late payments. Debt settlement may actually improve your rating if you can begin to make payments that you have previously had to forego.

It's time to start paying off that credit cards, now that you know the options.