Before they apply for personal loans to refinance their credit card debt, people in South Carolina should take stock of their situations and be aware of the pros and cons of this option. While these loans may help them to pay off debt incurred because of emergencies, medical bills or college expenses, refinance loans work better for some people than they do for others. For example, individuals who are likely to pay off their loans within the next year might choose to avoid refinancing. To get this type of loan, they would need to pay origination fees of anywhere between 1 and 5 percent, which could mean that they end up paying more than they owed originally.
For people in South Carolina facing high credit card bills, debt consolidation can offer an option for bringing together their debts so that they do not have to pay multiple high interest rates. Before going through with debt consolidation, they might consider the terms of the agreement. Debt consolidation may allow them to obtain lower payments, but it may be over a longer period with higher overall interest rates. They also have to go through an extensive application process to qualify debt consolidation.
If a consumer has a dispute with their credit card company, that dispute may need to be resolved in arbitration. While arbitration clauses are common in credit card agreements, roughly 75 percent of consumers don't know that they are in their agreements. Of those who were aware that they could possibly go to arbitration, 50 percent were wrong as to whether or not their credit card agreement included such a clause.
A number of South Carolina residents may be about to receive notices that the interest rate on their American Express card is increasing. Although the 2009 CARD Act has limited credit card companies' ability to increase card holder's interest rates, it is still possible, as about a million people with American Express cards are finding out.
Credit card debt is a serious problem in South Carolina as well as the rest of the United States. Those whose monthly minimum payments are more than they can afford have some options for lowering their debt, including debt settlement. Debt settlement companies attempt to make arrangements with creditors on behalf of their clients to reduce the principal balance in exchange for a lump-sum payment.
Avoiding credit card debt is much easier than recovering from it. As the balance on the card increases, the amount of interest that is accrued each month increases with it, requiring larger payments. These higher payments can make it more difficult for the consumer to pay for current and future expenses. This is why a repayment plan may be vital for any South Carolina residents attempting to recover from credit card debt. The plan should include reducing spending, speaking with creditors about reducing interest rates, suspending further credit card usage and prioritizing payments based on the interest rates.