Credit Cards and Bankruptcy

: Chris Lee Law Firm

  Filed under: Credit Tips

credit card debt

Credit cards can be an excellent tool when used responsibly and a costly expense when we let them get out of control. Few people read the fine print on a credit card application, and this can get us into trouble later down the road. The majority of personal bankruptcy cases are due to excessive credit card debt.

Low Rates

Be careful not to get lured into credit cards with extremely low-interest rates, these are often too good to be true. These credit card companies usually only honor that rate for a short amount of time; after a few months, the interest rate jumps up dramatically. Missing just one payment or exceed your credit limit and the credit card company can raise your interest rates again, plus charge you a fee.

These low-interest-rate cards make sense if you are paying off a higher interest card, and you can pay off the balance within a couple of months. Canceling the card before the higher interest rates kick in can be an excellent financial move.

Kick the Habit

If you tend to live beyond your means and use your credit cards to fund an excessive lifestyle, you may need to go cold turkey and cut up your credit cards if you want to get a handle on your debt. Contacting the credit card agencies and canceling your accounts will go a long way to get a healthier financial future.

If you can trust yourself, maybe keep one credit card on hand for emergencies. Use your credit card responsibly and only make purchases you can reasonably pay off in a month. Please don’t fall into the trap of letting the balance roll over to the next month, before you know it you may be back in the same situation you were in before you tried to pay off your credit card debt.

If you are overwhelmed by credit card debt, and cutting them up is not enough to get out your finances back in order, contact a Fort Worth bankruptcy attorney to find out how you can eliminate the debt and get a fresh start.

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