It is no secret that the United States just finally started to grow again after a severe world wide financial hardship. Unfortunately, although some stocks may be showing a rise, many Americans are dealing with an entirely new issue, overwhelming credit card debt. If you are one of these people, don’t feel bad. Studies show that the average American has over $3,000.00 in credit card account debt so, you are not alone. However, if you are one of the many people dealing with debt, you might end up with a smile on your face after all.

A few years ago, I started researching and teaching myself about different debt relief options. In this research, I found that credit card debt settlement and credit card account debt consolidation were the most popular forms of debt relief. So, here is my review of these programs:

Charge Card Debt Settlement: The process of saving funds to negotiate a settlement of credit card debt.


Pay No More Interest: When consumers enroll into a charge card account debt settlement program, they no longer have to pay interest on their credit card debt. Although the interest will be charged to the credit card debt, the negotiation of settlement is usually based on the original amount of credit card debt.

Pay Less Than What You Owe: Charge card account debt settlement is just that. It is the process of negotiating a settlement with the lender that will allow people to pay less than what they owe.

Get Out Of Debt Fast: Because consumers don’t pay interest and negotiate a lesser amount to pay on their charge card account debt in the debt settlement programs, they tend to pay off their debts at an extremely accelerated rate.


Harms Credit Scores: Unfortunately, because people are not paying their debts when they are in debt settlement programs, the defaults on the accounts cause extreme adverse effects on credit scores.

Consumers Can Be Sued: Another big con to this is that because people are not paying their debts, the lender may decide to sue the consumer for the total debt owed. If this happens, a settlement will not take place and a judgment will be placed against the consumer.

Can Be Very Expensive: Fees associated with credit card debt settlement can amount to between 10% and 20% of the debt. Therefore, if you owe $20,000.00, you may find yourself paying $4,000.00 for this process!

Who Should Take Part In Charge Card Account Debt Settlement

Because of the extreme nature of debt settlement programs, I feel that this should only be used as a last resort before bankruptcy. If the Americans feel that they can resolve their debts in any other way, they should try that first before credit card debt settlement!

Credit Card Account Debt Consolidation: Consolidating Debts Into One Easy To Manage Account


Reduces Credit Card Interest Rates: When consumers enroll into a credit card debt consolidation program, they provide proof of a financial hardship and in return are given a lower APR.

One Constant Payment: Although, charge card account minimum payments fluctuate making it hard to budget for, when in a credit card debt consolidation program, Americans will receive one monthly payment that will be the same each and every month.

Pay Off Debts Faster: Because of the constant payment and lower APRs, consumers generally are able to pay off their debts faster in a debt consolidation program than they will be able to on their own.


Closes Accounts: When placed into a debt consolidation program, credit card account accounts will be closed.

Harms Credit: Because credit card account accounts are closed, they harm the consumer credit scores. This is because this generally detrimentally affects the people debt to available credit ratio.

Very Expensive: Although APRs are reduced, the company that does the consolidation for people will charge. This is usually a monthly fee that can add up to the thousands over a period of paying off debts.

Now For My Favorite Option:

Balance Transfers: The process of transferring a balance from a high A.P.R. credit card account to a low APR charge card account.


Reduces Interest: Because balance transfer charge card accounts generally offer low promotional and long term interest rates, they are great for reducing overall APRs on charge card accounts.

No Third Party Involvement: Doing this on your own is as simple as going to and applying for a balance transfer charge card. No third party involvement is necessary.

Reduces Payments: Because interest rates are part of the calculation of charge card account payments, the lower interest means lower payments in most cases!


Balance Transfer Fees: The only con here is the balance transfer fee. Generally it ranges from 3% to 5% of the transfer however, because of low 0% introductory APRs, this fee is well absorbed into the savings!

I hope this article has given you everything you need to formulate your debt relief decision!

This article was written by Joshua Rodriguez and is brought to you by: Skymiles Credit Cards | Chase Skymiles Cards

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