The first thing you should do is stop delaying the problem and take care of the matter immediately, as the consequences could be very serious.
Having a credit card can be one of the most beneficial things in your life, since in addition to the purchases you can make and pay off little by little, paying off your debt month after month helps you create a good credit history.
But what happens if the fearsome phrase “I can not pay for my card” is formed in your mind? This article is to help you.
And remember that credit cards are not a debt, on the contrary, debts are generated by bad habits of people. With this, I want to tell you that it is extremely important to understand that “a credit is a present commitment payable in the future”.
But, if this is a philosophy of consumption that you still do not learn and now you find yourself desperate and surely you wonder how to pay a credit card.
If you already feel that interest is eating you, it’s time to clean your cards and leave them free of debt. Let’s see some options to do it.
How to pay a credit card
Know the current status of your debt
Many times we do not assume our responsibility for payment and in fact, there are people who consider that the money from credit cards is actually a gift from the bank.
That’s the first big mistake you can make when you have a card and you do not take responsibility for it.
Naturally, to know your debt you must know the origin of it. Therefore, before hiring a card or when you have already hired you should make sure you know everything about it. You must:
- Know the amount of the debt
- What is the CAT of the card
- What is your annuity
- What are the commissions and services that charge you
- What are your payment and cut-off deadlines
Stop making more purchases
It has all the logic of the world, however, sometimes the impulse beats us and we fall into more debt.
The important thing about acquiring things with a credit card is that they are only those that are budgeted and preferably, that is a priority.
If you have more than one credit account, then use it! Do not have them all to the limit, you never know when you really need them.
Therefore, it is very important that you have a planning of expenses ready to face any type of debt. After all, by not planning your expenses, you will most likely never be able to save money.
Determine your ability to pay
In order for you to settle a debt, it is essential that you determine more than once or on a daily basis your ability to pay. To do this you can analyze your expenses.
Know how much you pay for your basic needs such as food, transportation, and housing and if you pay for other things such as a pay TV service or a gym.
The surplus that remains after paying these basic (and not as necessary as the gym or pay TV), is what you can use to pay your debt.
The recommendation is not to allocate more than 20% of your income to the payment of a debt. Otherwise, liquidating a credit card will be the reason for your work and not the things you really want to do.
It is up to you to decide if you “work to pay” or “you work to be happy and grow professionally”.
Commit to paying more than the bill
Sometimes the minimum payment turns us into slaves of the accounts and then, it becomes almost impossible to pay.
So, it’s time to “tighten your belts” and commit to eliminating those ant expenses that make us feel that we can not save and instead of buying coffee and donuts every day, that money you invest in paying off your debts and give a little more month to month.
It is surprising how many people, trusting to make the minimum payment of their card, do not realize the amount of interest they are paying to the bank.
In this sense, the recommendation is to make at least six payments as the minimum, or the minimum global payment to not generate interest, which is broken down on your statement.
Ask for help from financial institutions
If you are in a debt situation, the recommendation is that you go to the bank that gave you the card in order to know under what conditions you can settle your debt.
To approach the bank and to state your situation is to act with honesty both with the banking institution and with yourself. Also, this would allow you to save your financial situation.
Knowing the amount you owe and your ability to pay will be the weapons you will negotiate with at the bank so they can reschedule your debt.
You can ask them to freeze both your card and your debt so that the interest and amount you owe stop increasing. Most banks usually take this decision well.
In addition, they can offer to settle your debt with advanced payments that go directly to the payment of the commitment that you have pending, or they can restructure your interests and payment periods to make it easier to pay off a credit card.
What happens if I stop paying my credit card?
The normal thing is that 24 hours after the omission of your payment the bank will contact you to know what happened to your payment and just kindly ask you to make your payment as soon as possible to avoid paying interest.
After 72 hours of default, you will most likely suspend future purchases in your account and have your interest rate suddenly change, plus the appearance of collection charges.
If you have been delayed for more than 30 days, calls from the bank’s collectors will start. They will want to know why you did not pay. You will be cordially invited to pay and later, report this situation to the Credit Bureau.
Perhaps the most serious point is when you have fallen behind in the payment of your card for more than 120 days. You probably accumulate a large debt and the bank has given your data to a collection agency.
The new collector, although he can not harass you so you can settle a credit card, will try by all means to make you pay. It is surprising how annoying this can be, but in addition, you will be permanently stressed.
So how can you liquidate a credit card?
Many will think what happens if I can not pay my credit card? What if I apply for a loan? Will I have a bigger debt just to pay the small ones? Know best consolidation companies to pay loans.
It is not about that, asking for a loan from a credit institution gives you the opportunity to end the interests that can end your peace of mind and make you spend your entire life in debt.
Look for a loan to settle debts that suits your needs, that has the lowest interest rate and above all, that can give you different payment options. Always remember to read the little letters.
Asking for credits and paying off your debts is a matter of financial education. Read, investigate, ask and above all, never stay with the doubt.
When you request a credit card carefully read each of the sections, be careful with interest rates because there is so much variety there can be confusion and above all, compare loan and credit options.
Liquidating a credit card is not impossible, but remember that it is better to be safe than sorry. If you are already going through that situation, it is best to talk to your loved ones and you decide to end the problem.