Is Free Online Credit Card Debt Advice Worth Listening To?

Credit card debt has become a major consumer problem today. High interest rates and a shaky economy interrupted the free flowing use of credit cards by consumers. People of all incomes and professions now find themselves in trouble with debt.

Many of the problems associated with debt stem from increases in interest rates that occurred prior to the date new lending regulations took effect last year.

A credit debt that was manageable at 10% APR may be impossible to pay when the interest rate is 30% APR. That change could occur from one month to the next as a result of one late payment.

New Laws

The new laws do not permit lenders to change the interest rate arbitrarily on balances already on your credit card. However, the laws do allow lenders to impose a penalty rate for up to six month on your balance.

Large lenders once forgave a single late payment but now will quickly impose the high penalty rate on your debt. This can triple your monthly payment and your budget.

Using Loans for Debt Consolidation

Debt consolidation loans are one avenue to pursue but perhaps not the safest option for those who are financially stressed. A loan to pay off your credit cards will have a specific term of payments and a lower interest rate.

However, such a loan will also carry higher consequences for non-payment of the debt. If you fail to pay your credit card debt, you will damage your credit rating but you will not lose your home, car or possessions. You won’t even lose the items you purchased with your credit card as credit debt is unsecured.

Free debt advice that says to take a loan to pay off credit card debt means placing something of value that you own at risk of being confiscated. This may be furniture, a vehicle or even your home if the loan is based on your home’s equity.

Debt Consolidation Programs

The DebtConsolidationCare site offers alternatives for paying off debt that is designed to help you find the best method for your personal situation.

There are stories provided by real people who have found ways to conquer credit card debt and from those who have been scammed by shady debt consolidation services.

The most valuable information on the site is the free debt advice that outlines the various methods for obtaining debt relief. Each path to financial freedom is full explained and examples are provided.

  • Interest rate arbitration – Obtaining a secured loan (avoid high risk loans) at a low interest rate to repay high interest debt. Advantages are lower monthly payments, improving your credit score and a specific term for repayment.
  • Debt management – How to work with a debt management service to create a working budget and pay off current debts. This may result in reduced APR, waiving of late fees and information on how to manage multiple bills efficiently.
  • Debt settlement – Working with a lawyer or professional debt service to settle your credit card debts in full by paying off only 40-60% of the balance due.
  • Chapter 13 bankruptcy – Personal bankruptcy through Chapter 13 is monitored by the bankruptcy court as a debt repayment plan. Creditors reduce the interest rate and the balance due in exchange for regular payments over a limited period of time. The consumer does not risk any of his assets when filing Chapter 13.
  • Chapter 7 bankruptcy – If the only debt you have is credit card debt, Chapter 7 allows you to eliminate the debt without repayment.

    Assets may be forfeited and the trustee appointed by the court would sell off the assets to pay a portion of the debt due. In practice, those who file for Chapter 7 may opt to keep their debt on their home or cars.

    If the lenders agree to re-affirm the mortgage or loan, the credit card debt may be written off in full without a loss of property or possessions. Chapter 7 bankruptcy requires the services of a qualified attorney.

DebtConsolidationCare also highlights the effect of various debt payment solutions on your credit file and provides advice on rebuilding credit after bankruptcy or default.

Recommended Services

One of the most useful sources of free credit card debt advice on site rates debt settlement and management firms. Law firms are identified and testimonials are listed as well a fees and miscellaneous expenses associated.

It is not recommended that you choose from the list provided but the list provides excellent options and it is easy to use it to form a short list of firms.

Once you have chosen a few debt management companies that interest you, do online research to check further into the company’s qualifications and consumer recommendations or complaints.


DebtConsolidationCare is an excellent site to use when you begin a search for debt advice.

With interactive tools and recommended debt management services, you will quickly begin to understand the various ways in which you can legally reduce or eliminate your credit card debt.