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Credit debt help when you owe money on one or more credit cards

Credit Card Debt overview

Credit cards rank among the most popular ways of purchasing products and services in shops and online, with the balance repaid each month on a set date.

When used responsibly, credit cards can provide a flexible, revolving line of credit. However, when used without due care and attention, the balance can quickly rack up and take years to repay.

Credit card debt is once again on the rise, breaking record levels of debt per consumer. Today, the average household owes a hefty £2,638 on their credit card(s). This figure would take 26 years and 5 months to repay if only the minimum repayments were made month on month.

If you miss the minimum monthly repayment on your credit card, you’ll fall into arrears. Once this happens, the creditor will contact you by either phone or letter to make a first demand for the missing repayments to be made. If you don’t catch up, your credit card account will enter default, which is when further steps will be taken to recover the balance that’s outstanding.

The advantages of Credit Cards as a credit debt help solution

  • Credit cards boost the protection you enjoy as a consumer when purchasing goods and services, and are popularly used to finance holidays and high-ticket electrical items.
  • Credit cards are extremely convenient, especially when travelling, as some car rental companies and hotels ask for a credit card in order to reserve a vehicle or room.
  • Some credit cards also offer reward points, which can be redeemed for either cash or products.
  • A credit card can provide a lifeline in emergency situations.
  • Using your credit card responsibly can build or repair your credit record.

Worried about debts that won't go away?

The disadvantages of Credit Cards as a credit debt help solution

  • Credit cards can feel as though you’re being handed free money until the time comes to repay the debt. In this sense, credit cards can encourage consumers to spend more than they can truly afford.
  • In comparison to credit such as a personal loan, credit cards can be a relatively expensive way to borrow, especially if you’re using your credit card for cash advances (which come with additional fees).

Credit Debt help tips for tackling Credit Card debt

  • Try to avoid missing your repayments, as this can add a costly late payment fee to your balance, on which you’ll also be charged interest.
  • Consider whether a credit card 0% balance transfer may be viable. This can move your balance, on which you’re being charged interest, to another card with a period of interest-free credit (usually of between 12 to 29 months). Just be aware that some providers charge a fee for this (which may be between 1.5% and 3% of the total balance).
  • Finally, you should remember that if you have a secondary card holder, they won’t be responsible for any part of the debt, even the parts of the balance they were exclusively responsible for borrowing/spending.

IVAs – A potential credit debt help solution for Credit Card debt

Individual Voluntary Arrangements are a debt settlement solution which allows you to tackle your debts over five or six years, after which time the remaining debts would be written off.

If you have credit card debts, or debts of other kinds, owed to two or more creditors totalling to £5,000 or over, it may be worthwhile researching Credit cards help solution before you make your next move.

*An Individual Voluntary Arrangement (‘IVA’) is subject to the customer meeting qualifying criteria and gaining creditor acceptance. Monthly IVA payments include fees and may differ to the example provided, based on the assessment made of your own personal circumstances – these fees will be clearly explained to you in writing by your IVA company. Debt write off amounts are subject to creditor acceptance and vary by individual customer based on their own financial circumstances, and are applied upon successful IVA completion.

Substantiation example, Someone owes £60,000, they pay £100 over 60 months which equals £6000, write off amount would be £54,000 which is 90% of total debt level. Upon submitting your details on this website we will pass your details to one of our approved partners as this website does not give any advice.

Free debt counseling, debt adjusting and credit information services are available from the Money Advice Service.

National Debt Help
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