While credit card debt isn’t uncommon, it should not be considered acceptable. You should consider loan resources, such as bank accounts, auto title loans, or home equity loans if you can’t reasonably pay off your credit balance in the foreseeable future.
Though a significant portion of families today have credit card debt doesn’t indicate that it should be considered even an essential evil or acceptable. From a fiscal perspective, each month, when you pay your bill, the sole credit card balance that is acceptable ought to be a zero equilibrium. Anything aside from paying your credit card balance off in its entirety will lead to accruing ridiculously higher interest rates that dilutes the power of your next pay check.
The reason that interest rates charged by the credit card companies is so high is because these companies are essentially giving you an unsecured loan, which means that no collateral has been pledged by you and they have no guarantee that you will pay them back. In actuality, they are already assuming that they won’t get paid back for all of their client’s accounts and therefore they’re charging a greater rate to offset those losses that are anticipated. Therefore in case your credit card balance has reached the point that you can’t foresee paying it off from your short-term long term paychecks, then it could be time to think about replacing your credit card debt using a collateralized loan, which should result in a significantly smaller interest rate.
The best way to do this by securing a house equity loan, provided that your house is owned by you and you also have some equity built up. Banks will generally tend to gauge the value of your house on the low end of its market value when considering these types of loans, which means you may need to attempt more than one lender, and generally your very best opportunity is with a bank that’s within the local vicinity of your home. If you are not able to get a home equity loan, then you can attempt to get an auto title loan which lets you utilize your vehicle as collateral, although be careful as sometimes the interest on automobile title loans aren’t as economical as they likely should be. Another alternative would be a signature or private loan by a financial institution, which is an unsecured loan you have signed a pledge that is direct to the bank that you will pay the loan back.
If all of these options fail, then you can attempt to borrow money from relatives or friends, however be aware of the potential effect that borrowing money could have on your relationship with the lender. 1 option that may help is to look at rolling the debt with a lower rate, to your credit card that’s offering a lower introductory rate.