How Do I Catch Up on Credit Card Payments?

The sooner you develop a plan for getting caught up, the less damage being behind will do.

During 2007, consumers with credit cards paid more than $18.1 billion in penalties, including late fees and over-the-limit fees. Getting behind on your credit card payments can ruin your credit and cause the card issuer to raise your interest rate, putting you even further in the hole. Learn ways to get help and get caught up on your credit card payments.

Instructions

1. Contact your card issuer to discuss payment arrangements. Most companies will establish automatic monthly payments for you at a reduced interest rate to help you catch back up. This will usually stop collection calls, late fees and over-the-limit fees.

2. Review your monthly budget to determine if items can be dropped to help you catch back up. Getting your credit in line usually requires making sacrifices. Try to eliminate as many unnecessary items from your budget as you can. Common money traps are eating out, soft drinks, tobacco and alcohol.

3. Ask your family and friends for help. Family can be a great resource for help in a time of need. Don't be embarrassed to ask for financial assistance.

4. Consider a personal loan to pay off your credit cards. If you have multiple credit cards, this will be a way to consolidate everything into one monthly payment. While you may or may not be able to save money on your monthly payments, you will have a clear schedule for paying off your credit card debt.

Tips & Warnings

• If your credit card debt is out of control, it may be beneficial to consider credit counseling or bankruptcy.

References

• Hoffman Brinker