Can You Get Out of Credit Card Debt Without Paying Everything You Owe

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Credit card debt can feel like a never-ending cycle. You might feel like you are constantly paying off your debts, with little to show for it in the end. If this sounds familiar, you’re not alone. Millions of Americans are struggling with credit card debt right now.

However, there are ways to get out of credit card debt without paying everything you owe. In this blog post, we will explore how can you get out of credit card debt without paying everything you owe.

Opt for Debt Settlement

One way to get out of credit card debt is by opting for debt settlement. Debt settlement is when you negotiate with creditors to pay off a portion of your debt. The amount that you settle for will be less than the amount you originally owed, but it can still provide some relief from your credit card debt.

There are a few things to keep in mind if you’re considering debt settlement as an option to get out of credit card debt. Not all creditors will be willing to settle your debt. They may only agree to settle if they believe they will not be able to collect the total amount of what you owe them. Even if a creditor does agree to settle your debt, you will likely still be responsible for paying taxes on the forgiven debt.

Debt settlement can have a negative impact on your credit score. While it may not be as damaging as declaring bankruptcy, it will still lower your credit score. This can make it more difficult to get approved for loans in the future. For more advice on this form of debt relief,  you’ll find useful information at Freedom Debt Relief.

Let the Debt Pass to a Debt Collector

Another way to get out of credit card debt without paying everything you owe is by letting the debt pass to a debt collector. If you stop making payments on your credit card debts, they will eventually be sold to a collection agency. Once your debts are with a collection agency, they will attempt to collect the money you owe them. Often, collection agencies are willing to accept a lower payment than what you originally owed.

However, there are a few things to keep in mind if you’re considering letting your debt pass to a collection agency. It’s important to know that the collection agency will likely report your debt to the credit bureaus. This will result in your credit score taking a hit.

The collection agency may take legal action against you in an attempt to collect the money you owe them. And even if you can make a deal with the collection agency, you will still be responsible for paying taxes on the forgiven debt.

Declare Bankruptcy

A last resort option for getting out of the credit card debt you owe is declaring bankruptcy. When you declare bankruptcy, your credit card debts will be wiped away. However, there are a few things to keep in mind if you’re considering bankruptcy as an option.

First, it’s essential to know that declaring bankruptcy will negatively impact your credit score. It will stay on your credit report for up to ten years and make it very difficult to get approved for loans in the future. Second, you may still be responsible for paying taxes on the forgiven debt.

Finally, filing for bankruptcy is a lengthy and complicated process. You will likely need to hire an attorney to help you through the process.

Handling Credit Card Debt the Right Way

Working with a professional credit counseling agency is the best way to handle credit card debt. A credit counseling agency can help you create a budget and develop a plan to pay off your credit card debt. They can negotiate with creditors to lower your interest rates and monthly payments.

When you work with a credit counseling agency, it’s important to make sure that they are a reputable and accredited organization. You can check their accreditation by visiting the website of the National Foundation for Credit Counseling.

While it is possible to get out of credit card debt without paying everything you owe, there are consequences to consider.

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