People deal with their debt in many ways, and the right approach for you depends on the type of debt you owe and other details of your financial situation. Credit card debt is a common problem for many in Tennessee, and sometimes, these balances accumulate because of factors beyond your control. For example, you may have a lot of credit card debt because you lost your job and were unable to pay for things in full.
Other people rely on their credit cards for daily purchases like groceries or gas. It’s easy for these balances to spiral out of control due to minimum payments and accumulating interest. Eventually, a person may find that he or she is unable to keep up with the payments and keep the balance manageable. Eventually, a consumer may start to look for debt relief options, including a balance transfer card.
What does it do?
A balance transfer card is a specific type of credit card that allows a person to move his or her balances from other cards to one place. This is an attractive option because it can make it simpler to manage payments. Instead of multiple payments of different amounts each month, an applicant would end up with only one. These cards can also have lower interest rates than other types of cards. In some cases, they can help an overwhelmed consumer catch up.
Potential drawbacks
Opening any type of credit card comes with some risks for the applicant. There are possible hidden fees and unexpected charges that can catch the card holder by surprise. With balance transfer cards, there can be high fees associated with actually transferring the balance. If the card came with a low or zero interest rate, it is possible that could increase after a certain amount of time. It is important to carefully read the terms of the agreement before completing an application.
A better option
There are other and possibly better ways to deal with excessive credit card debt. Instead of applying for a balance transfer card, it may be more practical to consider the benefits of bankruptcy. This process allows an applicant to discharge certain type of balances once and for all.
Before applying for a balance transfer card or making choices that could impact your financial future, you may want to speak with an experienced bankruptcy attorney. An assessment of your case can help you understand your legal options and determine if bankruptcy is best for your situation.
