A Fast Way to Pay Off Store Credit Debt
Store credit offers a convenient short-term solution for many store purchases. Stores offer revolving and installment credit accounts to meet the credit needs of consumers. If you have accumulated revolving or installment store credit debt, you can pay off the debt fast by transferring the balance to a low interest rate credit card or by implementing a budget to pay down the debt.
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Revolving Store Credit
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Revolving store credit, also known as a store credit card, is a type of debt frequently issued by retail stores. This type of credit is open-ended and allows the borrow to continuously use a line of credit up to a maximum credit limit. This type of credit usually carries a high annual rate of interest and offers limited use compared to a traditional credit card since the card is normally not accepted by other retailers.
Installment Store Credit
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Installment store credit is a type of store credit that limits the borrow to a fixed loan amount. The terms of an installment loan dictate the terms of the loan including the rate of interest and the required monthly payment. Like revolving store credit accounts, installment loans issued by stores usually carry high rates of interest. Additionally, you may not have time to read the fine print of the loan paperwork at the store when you agree to the terms of the loan.
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Balance Transfer Option
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Because revolving and installment store credit usually offers the borrow unfavorable terms, it is often in your best interest to pay off this debt fast. One of the quickest options is to transfer any balance from the store credit account to a zero percent or low interest rate credit card. Many credit cards offer introductory terms with preferable interest rates for balance transfers. Check with your existing credit card companies to determine if they offer balance transfers with zero percent or low interest rates. Alternatively, you can apply for a new credit card with a balance transfer option.
Budget for Debt
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Another option to pay off your store credit debt fast is to budget money to pay off the debt. Contact the company that services the credit account and find out your balance. Also find out if there is a prepayment penalty associated with paying off the account. Determine how much money you can afford monthly to use to pay down the account. Since you want to pay off the account fast, budget the maximum possible carefully considering all income sources and expenses. Set aside the budgeted amount of money each month and use it to pay down the account balance.
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