If you a military servicemember buried under an ever-mounting pile of debt, credit card debt forgiveness can offer a better way out than resorting to payday loans, which can compound the problem by charging huge interest rates.
Before they were famous, many truly influential men and women started by serving their country in the US military or grew up in military families.

Credit Card Forgiveness Can Help Reduce Your Military Debt

Posted:

In an unprecedented move in the credit industry, more lenders and creditors have chosen forgiveness over collection of credit card debts. Troubled borrowers, military and civilian alike, are being offered forgiveness for 20 to 70 percent of their credit card debt.

In the economic recession, more and more Americans are finding it difficult to pay credit card debts. Creditors are creating new ways to help, going as far as accepting pennies on the dollar as payment in full for credit card balances.

MOUNTING MILITARY DEBT CAN BE REVERSED

If you a military servicemember buried under an ever-mounting pile of debt, credit card debt forgiveness can offer a better way out than resorting to payday loans, which can compound the problem by charging huge interest rates. Payday loans are often financial traps for struggling military families. Today, credit card lenders themselves are offering you a break on your debt in numerous ways: by waiving late fees, lowering interest charges, extending payment periods and reducing balances owed on your credit card.

WHY ARE CREDITORS WILLING TO ERASE YOUR DEBT?

Lenders are not just being charitable; they are being realistic. Banks and credit card companies, anticipating rising defaults on credit card debt as the economy deteriorates, know that they are actually competing with other creditors for your payments. For years, lenders competed to be the credit card most used by borrowers; now, they find themselves competing to be the first one paid back.

Creditors also know that once people get their finances in order, they can start borrowing again.

WHAT DOES CREDIT CARD FORGIVENESS MEAN FOR MANAGING YOUR MILITARY FINANCES?

Credit card lenders have authorized collection agents to make adjustments for those in financial distress. Debt collectors report that the number of troubled borrowers getting payment extensions has at least doubled.In addition to debt forgiveness, debt collectors are allowing many delinquent borrowers to pay down their debt over the course of a year rather than six months.

CREDIT FORGIVENESS HAPPENS ONE PERSON AT A TIME

Unlike the mortgage loan modification programs like the Obama Mortgage which is designed to address thousands of mortgages at once, credit card debt forgiveness is being handled on a case-by-case basis.

Some lenders are contacting borrowers shortly after they fall behind on their payments to avoid a larger problem; others are being even more proactive, reaching out to customers who seem likely to fall behind.

Be advised that credit card companies offer deals only to people who meet certain criteria, considering delinquency period (90 days or longer), borrower's income, existing bank relationships and a clean credit record with few missed payments.

WILL CREDIT CARD FORGIVENESS IMPACT YOUR MILITARY CREDIT SCORE?

Keep your military credit score in mind when deciding to go the route of credit card debt forgiveness: while a deal may help avoid a credit card cancellation or even bankruptcy, it will also lead to a sharp drop in your credit score for as long as seven years, making it more difficult to obtain new loans, or to get the best interest rates and credit terms on new auto loans, mortgages and more. Your credit score may fall 70 to 130 points, impacting an otherwise strong score that you want to maintain over 700.

Credit card lenders expect to write off an unprecedented $395 billion of soured loans over the next five years, according to The Nilson Report, an industry newsletter - compared with a $275 billion total of the last five years.So don't let the stress of credit card debt compromise your military life; there is help. If you are having trouble stretching your military pay to cover your rising credit card debt, contact your credit card company or collection agency directly. It's up to you to ask for a reduction in your credit card balance.and you may just get it.



RELATED ARTICLES:


Sponsor:

VA Loans for Veterans
Complimentary VA loan pre-approvals will give you the comfort you need to shop for your home with confidence. VA refinance loans available.


VA Home Loans

Military Hub is not a government website and is not affilitated with any branch of the U.S. Military.


Support Our Troops:

Semper Fi Fund
The Semper Fi Fund provides financial assistance and support to service members and their families.
IAVA - Iraq and Afghanistan Veterans of America
IAVA is the nation's largest nonprofit, nonpartisan organization representing veterans and their families.
Team Rubicon
Team Rubicon unites the skills and experiences of military veterans with first responders.
Pat Tillman Foundation
The Pat Tillman Foundation invests in military veterans and their spouses through educational scholarships.

About Military Hub
Privacy Policy
Contact / Advertise

Copyright © 2008 - 2017
Advertise Military, LLC
All Rights Reserved

Disclaimer: MilitaryHub.com and MilitaryRates.com are private websites that are not affiliated with the U.S. Department of Veteran Affairs, any U.S. government agencies, or any U.S. military branches. Our sites contain basic information about veteran benefits, pay tables, current events, and news for active duty military personnel, military veterans, and their families. You can find additional information on these topics at the official website for U.S. Department of Veteran Affairs.