A survey from U.S. News & World Report found that 21% of Americans don’t know if they have credit card debt. It also found that Americans don’t always know the interest rate on the debt that they do have. Of those who were surveyed, 37% said that they had just one credit card while 12% said that they had five or more credit cards. There are many ways that debtors can get a handle on their balances such as transferring them to new cards.
These cards generally come with a lower interest rate or no interest at all for a certain period of time. However, 45% of those surveyed said that they didn’t know if they would be charged a fee for transferring a balance to a new card. Of those who actually transferred a balance, 12% were able to pay down their debt before the introductory offer expired.
This is important because the interest rate on a credit card can rise dramatically after this happens. In some cases, individuals will make new purchases with their cards, which can result in even greater financial trouble. In addition to avoiding new purchases, individuals should know when their introductory rate converts to the normal rate. According to the Balance Transfer Survey, 60% of respondents said that they paid their bills in full each month.
Individuals who are struggling to pay off their credit card debt may want to consider filing for bankruptcy. Doing so may put an end to creditor phone calls and make it possible to have a debt discharged without the need to pay any of the outstanding balance. Those who file for Chapter 13 bankruptcy may keep ownership of their house or other secured assets during the repayment period that lasts three or five years.