Credit Card Debt Levels Fall in September; Fees and Rates Rising
Consumer debt levels fell for the eighth consecutive month in September, according to a report issued by the Federal Reserve. Falling by an estimated annualized rate of 7.2 percent, US consumer debt fell by approximately $14.8 billion. Consumers have reduced debt by about 86.2 billion since September 2008, but this isn’t as commendable as it appears. Included in this figure are debts eliminated through charge-offs by credit card issuers and lending institutions. The Fed estimates the rate of declining consumer debt to be about 10 percent for the third quarter of 2009.
What’s “Up” with Credit Card Rates and Fees?
Credit card companies are responding to recent legislation regulating some of their consumer-unfriendly practices by reducing credit lines, hiking interest rates, and imposing more fees. If you’re tired of traveling on the hamster wheel of credit card debt (you pay and pay and pay, and get nowhere fast), Credit card debt consolidation may be an option.
Debt Consolidation and Consumer Credit Counseling
Consumer credit counseling services work as intermediaries between consumers and their creditors to provide affordable debt repayment solutions. If you agree to a repayment plan through credit counseling, you’ll sign an agreement and make one payment to your credit counseling company, which then deducts its service fee and distributes what’s left to your creditors. Paying one bill instead of several helps avoid missed or late payments, and making steady payments will help reduce debt faster than if you continue racing along on the hamster wheel of juggling minimum payments and barely breaking even.
Debt Management Enhances Debt Consolidation Efforts
Credit counseling typically provides the following services:
Evaluation of income and debts Develop a cash based budget including amounts required for your debt consolidation plan and emergency savings Negotiate terms of debt consolidation/repayment plan with creditors Collect and distribute payments to your creditors Provide ongoing support for budgeting and debt management Charge administrative fees according to income and ability to pay
If credit card debt is ruining your credit and your life, get debt help immediately. Credit counseling and debt consolidation solutions may take a few years, but reclaiming your life makes it all worthwhile.
Similar Posts:
- Credit Card Debt Collection: Senator Cites Need for Increased Consumer Protection
- Falling consumer credit card debt: Are we learning a lesson?
- Reducing Consumer Debt: Balancing Results with Consequences
- Credit Card Debt: Floating Down the River of Ruin
- Debt Management: Statistics Highlight Need for Consumer Action
