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6 things to avoid if looking for credit card debt forgiveness
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Between the high interest rates and extra fees that credit cards come with, it can be remarkably easy to find yourself facing issues with credit card debt. After all, if you’re carrying a credit card balance (or two) from month to month, just one minor hardship, whether it’s a job loss, medical issue or emergency home repair, can lead to serious debt issues that are hard to overcome.
And, the reality is that anyone can get in over their head with credit card debt in today’s high interest rate environment, even without the extra hardships. That’s because, following a series of Federal Reserve rate hikes, credit card rates are now hovering above 21% on average. And, with credit card interest rates that high, all it takes is a few months of a high balance for the interest charges to compound, making it tough to pay off what you owe.
If you’re currently grappling with unmanageable credit card balances, one potential solution is to try negotiating with your creditors for debt settlement, also known as debt forgiveness. When you opt for credit card debt forgiveness, you negotiate with your creditors, either through a debt relief company or on your own, to settle your debts for less than the full amount owed. But while debt settlement can be a lifeline for borrowers who are in financial trouble, there are some things you should avoid if you’re trying to take this route.
Find out what your credit card debt relief options are online now.
6 things to avoid if looking for credit card debt forgiveness
If you want to settle your credit card debt for less than what you owe, take note of the following:
Don’t add new debt to the mix
The first and most crucial thing to avoid when looking for credit card debt forgiveness is taking on new debt. If you want to settle your credit card debt, stop using all of your credit cards entirely. Even a single new charge can derail your efforts in the creditors’ eyes. They need to see that the cycle of creating new debt has been broken before they’ll consider decreasing or writing off your existing balances. The temptation to use your cards will be there when cash is tight, but using credit will signal that you can’t control your spending habits.
Explore the many benefits that the right debt relief company can offer you here.
Don’t misrepresent your financial situation
When pursuing debt settlement, you’ll need to demonstrate a true inability to pay your full credit card balances over time through your current income. So, don’t lie or fudge the numbers on your income, assets and expenses to try and qualify. If you’re working with a debt settlement company, provide them with complete access to all your income sources, debts, expenses and assets right from the start instead. Any omissions you make early in the process could later be grounds for your creditors to claim you attempted fraud and reject settlements.
Don’t cherry pick accounts
When you have credit card debt across multiple cards, avoid the temptation to try and settle one account at a time in a piecemeal approach to debt forgiveness. The debt relief company and your creditors will want total transparency into your overall unsecured debt exposure across all credit cards and accounts. Present them with a complete accounting of what you owe and stick to negotiating it all together rather than leaving certain accounts out.
Don’t take out new loans to pay off debts
You might think it makes sense to consolidate your credit card balances onto a new debt consolidation loan. However, in the creditors’ eyes, this simply represents exchanging one debt for another, and loan obligations are viewed differently than credit card balances when it comes to debt settlement. And, by paying off plastic with another form of debt, you greatly reduce your odds of getting the credit card companies to agree to a reduced payoff.
Don’t use other assets to pay off debts
Using funds from retirement accounts, home equity loans or other assets to pay off credit card debt will also show creditors that you have a remaining ability to pay that disqualifies you from settlement. In turn, any path to pay the full debts from other means can torpedo the debt forgiveness opportunity.
Don’t give up too early
The debt settlement process can be tedious and slow-moving. It can often take meticulous budgeting, document submission and back-and-forth negotiation before your creditors approve a settlement. You’ll need perseverance and stamina throughout all the hoops you’re made to jump through. So, don’t get discouraged and give up halfway through, or you’ll have wasted all your efforts only to remain stuck at the beginning.
The bottom line
While you have the option to try and negotiate credit card debt settlement on your own, it can be difficult to do. Most people are better off hiring a reputable debt settlement firm that has established negotiating processes to go to bat on their behalf. Either way, though, following the strict rules and requirements is mandatory if you want any chance at qualifying for a drastically reduced debt burden.
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Sen. Thom Tillis says “the scope” of Helene damage in North Carolina “is more like Katrina”
As recovery missions and repairs continue in North Carolina more than a week after Hurricane Helene carved a path of devastation through the western part of the state, the state’s Republican Sen. Thom Tillis called for more resources to bolster the relief effort and likened the damage to Hurricane Katrina’s mark on Louisiana in 2005.
“This is unlike anything that we’ve seen in this state,” Tillis told CBS News’ Margaret Brennan on “Face the Nation with Margaret Brennan” on Sunday morning. “We need increased attention. We need to continue to increase the surge of federal resources.”
Hurricane Helene ripped through the Southeast U.S. after making landfall in Florida on Sept. 26 as a powerful Category 4 storm. Helene brought heavy rain and catastrophic flooding to communities across multiple states, including Georgia, South Carolina, Tennessee and Virginia, with North Carolina bearing the brunt of the destruction. Officials previously said hundreds of roads in western North Carolina were washed out and inaccessible after the storm, hampering rescue operations, and several highways were blocked by mudslides.
Tillis said Sunday that most roads in the region likely remained closed due to flooding and debris. Water, electricity and other essential services still have not been fully restored.
“The scope of this storm is more like Katrina,” he said. “It may look like a flood to the outside observer, but again, this is a landmass roughly the size of the state of Massachusetts, with damage distributed throughout. We have to get maximum resources on the ground immediately to finish rescue operations.”
Hurricane Katrina left more than 1,000 people dead after it slammed into Louisiana’s Gulf Coast in August 2005, flooding neighborhoods and destroying infrastructure in and around New Orleans as well as in parts of the surrounding region. It was the deadliest hurricane to hit the mainland U.S. in the last 50 years, and the costliest storm on record.
The death toll from Hurricane Helene is at least 229, CBS News has confirmed, with at least 116 of those deaths reported in North Carolina alone. Officials have said they expect the death toll to continue to rise as recovery efforts were ongoing, and a spokesperson for the police department in Asheville told CBS News Friday their officers were “actively working 75 cases of missing persons.”
On Saturday, the U.S. Department of Transportation released $100 million in emergency funds for North Carolina to rebuild the roads and bridges damaged by the hurricane.
“We are providing this initial round of funding so there’s no delay getting roads repaired and reopened, and re-establishing critical routes,” U.S. Transportation Secretary Pete Buttigieg said in a statement. “The Biden-Harris administration will be with North Carolina every step of the way, and today’s emergency funding to help get transportation networks back up and running safely will be followed by additional federal resources.”
President Biden previously announced that the federal government would cover “100%” of costs for debris removal and emergency protective measures in North Carolina for six months.
With North Carolina leaders working with a number of relief agencies to deal with the aftermath of the storm, Tillis urged federal officials to ramp up the resources being funneled into the state’s hardest-hit areas. The senator also addressed a surge in conspiracy theories and misinformation about the Biden Administration’s disaster response, which have been fueled by Republican political figures like former President Donald Trump.
Trump falsely claimed that Mr. Biden and Vice President Kamala Harris, his Democratic opponent in the November presidential election, were diverting funds from Federal Emergency Management Agency that would support the relief effort in North Carolina toward initiatives for immigrants. He also said baselessly that the administration and North Carolina Gov. Roy Cooper, a Democrat, were withholding funds because many communities that were hit hardest are predominantly Republican. Elon Musk has shared false claims about FEMA, too.
“Many of these observations are not even from people on the ground,” Tillis said of those claims. “I believe that we have to stay focused on rescue operations, recovery operations, clearing operations, and we don’t need any of these distractions on the ground. It’s at the expense of the hard-working first responders and people that are just trying to recover their lives.”
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