Michigan residents can find themselves buried under a mountain of debt for a variety of reasons. In some cases, an unexpected job loss or illness leads to excessive credit card debt. In other scenarios, consumers were never properly educated about credit card use, and a poor financial situation snowballed into excessive debt levels. The following information is provided in the hopes of helping consumers avoid the pitfalls of credit card debt.
One aspect of credit cards that many consumers fail to adequately understand involves how interest plays into the process of charging. Interest is applied to each and every purchase made using a credit card. Statistics suggest that the majority of cardholders carry a balance on their cards, those charges can mount quickly, often ending up higher than the value of the initial purchases.
The fees associated with the use of credit cards get many consumers into trouble. Few people read the fine print that comes with offers for new lines of credit, but understanding the fees and charges associated with each card is critical to avoiding unexpected costs. Fees can follow balance transfers, use of a card while travelling internationally, or taking out a cash advance.
While these tips may help many in Michigan to avoid high levels of credit card debt, there are circumstances in which debt troubles arose for reasons beyond the borrower’s control. In such cases, filing for personal bankruptcy is often the best path to lasting debt relief. Consumers should research the pros and cons of bankruptcy to determine if this approach is their best option for moving forward.
Source: Yahoo! Finance, “5 Things About Credit Cards Your Parents Didn’t Tell You,” Jason Steele, July 18, 2013