Mythbusters: Common Credit Card Misconceptions

 Posted on May 12, 2014 in Bankruptcy

One of the reasons why people find themselves trapped by debt is because they have a misunderstanding about a few key issues regarding credit card debt. These credit card misconceptions or myths can set an individual up for failure by leading that person to believe he or she can tackle credit card debt easily. For some cases, the only real solution is to wipe out the debt in bankruptcy.

Many people think that any person can get credit card balances cut in half without too much effort. This is not necessarily true because credit card companies screen clients to make sure that the claimed hardship actually meets company-wide understanding requirements. Not every individual is going to be able to slice their debt in half.

Another common myth or credit card misconception is the idea that going through debt settlement will improve your credit situation and cause less damage than bankruptcy. Many debt settlement providers require a lump sum payment. If you are not able to pay it, you could get slammed on your credit score.

If you are scraping by, making minimum payments right now, it is also highly unlikely that you will be able come up with a lump sum payment to make debt settlement worth it. The majority of companies will report such a settlement to your credit report, thus doing just as much damage as bankruptcy. For those in financial peril, it does not really make sense to struggle just to come up with the payment for the debt settlement when what is really needed is a completely fresh start.

You do have options if you find yourself unable to deal with mounting debt. If you are feeling the pressure, set up a meeting with an attorney to walk through your options before committing. Find the best solution for you. Contact a Texas bankruptcy attorney today to begin your personal consultation.