Credit cards are what known as “toxic debts” meaning they are depleting your financial resources and they are tremendous burden on your wallet. You’re willing to pay potentially several hundreds of thousands of dollars for one purpose to maintain your ability to obtain more debt while keeping your credit score good. Most people in your situation are trying to get “out” of debt not keep it.
If you are to do a debt loan you will pay on that credit card interest for 20 to 30 years. That is money you could put into retirement, other investments, pay your home off, etc.
If you were able to successfully settle that debt you could cut the balance down close to 1/2 of what you owe, make the “same” payments you’re making right now, and have it paid off in 2 YEARS – as opposed to 30 years. Your credit score will dip a bit during the debt settlement but who cares? You don’t plan on getting new debt – you’re trying to get rid of it. When you pay everything off your scores should sky rocket. I’ve been doing 2nd mortgages and have seen credit scores skyrocket very quickly.
Think about how much it’s going to take you to eliminate those credit cards. No matter what route you go, other than debt settlement, it’s going to eat up hundreds of thousands of dollars if you make minimum payments. Don’t wait until interest rates go higher either, because it may become even more difficult to qualify for credit and you may be forced into bad credit debt consolidation. You think your payments are high right now?
Interest rates are at an all time low. When they go up your payments will skyrocket.
Keep it in mind. This is a business decision that, if you can qualify, may be one of the best financial decisions that you ever made. Think about it and do the math -$25,000 versus potentially $250,000 in interest. Article written by Jeff Morris
