Getting your first credit card may have felt quite liberating. The minute you had that plastic card in your hand, you probably felt like an adult who was ready to start building your credit score. Unfortunately, having access to multiple credit cards can lead to the temptation of spending more money than you have available to pay back. If you've found yourself in this vicious cycle of dealing with a lot of credit card debt and trying to make those monthly minimum payments to stay afloat, you're probably getting tired of it all.
Although your initial intention may have been to apply for credit cards to start building your credit score, you might have maxed them out when paying for different expenses and are now stuck trying to pay back thousands of dollars. If you're feeling overwhelmed, stressed, and you're not sure what to do, there are options for you that could help you get out of this debt cycle and improve your financial situation.
The Debt Settlement Option
There is always the option to work with a debt settlement company. When you choose to get help from one of these companies, they're going to tell you to stop paying your minimum monthly payments. Your credit score will drop and you're going to have to let those accounts go into collections. However, the company is willing to negotiate with the creditors on your behalf to reduce the amount you must pay back to them. Instead of paying so much in monthly payments, you'll only have to pay one set fee each month to the debt settlement company, which they'll use to start settling those debts you have.
Although it's an option to consider, it may not be feasible. The debt settlement companies will still expect you to pay a set fee each month, but you might not have the extra money to spare, especially if you're living from one paycheck to the next.
The Bankruptcy Option
If you're unable to make payments to a debt settlement company, the best solution for you to get out of debt is to file bankruptcy. You may be scared to take this route, but it's something that can help you achieve financial freedom. If you're going to file for bankruptcy, you should find a bankruptcy lawyer service in your area with experience helping people who are in situations like yours. The lawyer can take a look at the amount of debt you have, help you decide which chapter is best for you to file, and assist you with the filing process while making sure the creditors stop harassing you. It's a step-by-step process, but it's one that could help you get back on your feet and out of debt.
You probably never expected to get into the debt situation you're in, but now that it's becoming overwhelming, it's time to get help. Instead of stressing over your finances, consider debt settlement or filing for bankruptcy so that you'll get closer to financial freedom.