Author Bio:
This article has been written by Amy Lewis. She is associated with Oak View Law Group, a bankruptcy law firm. She writes on a wide range of financial topics like credit card debt settlement, federal debt relief programs, debt management, debt consolidation, bankruptcy etc.
It’s the same story everywhere. Every time we decide to make a big dent in our credit card bills, we end up swiping the card to buy groceries or to repair the car and the bills continue to accrue. If you are sick and tired of working hard just to pay back interest to the bank, it is high time for you to make a move. Read on to learn how dangerous credit card debt can be and why you should evade incurring credit card debt as much as possible.
Reasons People Fall Victim to Credit Cards
The credit industry has introduced some drastic changes in the financial market and has made the lending and buying process much easier and convenient. It doesn’t make much sense to draw money from bank account every time you need it with a credit card around. Easy access to liquid cash makes credit cards one of the most convenient options to borrow. With no worry to repay the fund, people tend to overspend on credit cards and soon end up in huge credit card debt. The credit market makes more of a profit off of less responsible people therefore they indulge in unscrupulous spending. In today’s world, credit cards are always available for everyone, no matter if the person is already in debt or struggling to make ends meet on their income.
Lenders promote their cards through mail, telephone – and it’s pretty hard to resist their tempting offer. Who does not like to get a little extra money for new tires or kid’s clothes? Well, we all do I guess, but unfortunately the credit card companies know this and they utilize these weaknesses to make a solid profit.
Credit Card Debt Traps
The next time you sign up for a new credit card, it’s vital you recognize the high dangers that it involves. Credit cards have a huge impact on your credit score. The credit report takes into account several factors like how much credit you have available to spend, what your current balances are, and the total numbers of lenders you owe. Therefore the more debt you have, the worse your credit rating becomes- even if you pay on time.
Credit cards charges the highest APR which makes it even more difficult to mitigate the bills. Unlike traditional bank loans, credit cards usually have a hefty interest charge, from around 15% to 20%. In addition, if you delay on your payment or make less payment, late fine penalties charge upon your account and credit card debts spirals out of control. They can also alter your interest rate if you’ve recently maxed out your credit from any individual lender.
It is not a great feeling to be saddled with credit card debt. The stress from a huge debt burden can cause harm to your financial and mental health.
To conclude, be proactive, vigilant and stay away from plastic money as much as possible in order to spare yourself the horror of piles of credit card debt. Use cash or a debit card instead and ensure a debt fee life sooner or later.
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