Credit Card Debt Is On The Rise
A recent survey indicates the spending habits of the American consumer. After two years of moderate credit card use, new figures from Card Hub show that credit card use has significantly increased during the past year. Consumers are on track to end 2011 with a $64 billion increase in credit card debt.
Americans are also paying off credit card debt at a slower pace. During the first quarter of each year credit card debt usually declines, mostly due to annual bonuses and tax refund checks. In 2009 and 2010, consumers paid down more in the first quarter than they charged in new debt through the end of the third quarter. This year consumers kept the cash and kept charging throughout the year. Even more disturbing is that this year's third quarter credit card debt total was 154 percent more than in the same period last year.
Carrying large credit card debt can create serious financial problems. According to the Federal Reserve's credit card repayment calculator, a $5,000 debt at a 15% interest rate will take 7 years to pay off at $100 per month. During this time you will pay an extra $2,896 in interest charges!
If credit card fees are eating up your paycheck, it may be time to consider bankruptcy. During a Massachusetts Chapter 13 bankruptcy you are able to structure an affordable repayment plan to pay credit card debt. Whatever you are not able to pay will be discharged after three to five years of repayment.
If you cannot afford to repay anything towards your credit card debt, a Massachusetts Chapter 7 may be the answer. Chapter 7, also called a "straight bankruptcy," lasts about five months and nothing is paid to your credit cards. Most Massachusetts bankruptcy debtors are able to keep everything they own while discharging debts they cannot afford to pay.
When credit card debt has taken over your finances, call the Law Office of Robert W. Kovacs, Jr. toll-free at (877) 315-2641 and learn how the federal bankruptcy laws can help. Don't let credit card debt hold your paycheck hostage! Bankruptcy offers powerful protection from creditors and can discharge overwhelming debts.