When an Arkansas family is struggling under a heavy burden of debt, stress levels will rise. Increased stress can bring on tension between spouses and can make it difficult to enjoy life. What many parents fail to understand is the impact that serious debt can have on their children. A recent study looked at the issue, and the results may lead some families to give debt settlement or bankruptcy serious consideration.
After the excitement and joy of handing out presents to loved ones over the holidays, the reality of overextended credit card debts may hit some Arkansas consumers in January. No one wants to face a credit card lawsuit, and when the bills start arriving, consumers may explore remedies that will provide a quick solution. A popular choice at the beginning of every year is said to be 0% balance transfers on credit cards. Although the potential of quick debt relief without interest may be appealing, there are several pitfalls to consider.
For many in Arkansas, living with a heavy load of credit card debt is akin to being a lobster in a pot. The situation seems fine for a while, but the temperature is slowly rising, even as the lobster is unaware that he is being cooked. Before long, the water is at a boil, and there is no turning back for the unfortunate crustacean. The following tips are offered in the hopes of giving borrowers the tools needed to evaluate their credit debt, and to know when it is time to crawl out of the pot and seek debt settlement or bankruptcy.
Once debt has reached a critical level, many Arkansas consumers are unable to think of little else. Anxiety over how to pay the bills can be crippling to one's health, happiness and the well-being of interpersonal relationships. Once this point has been reached, many will look for relief in the form of debt consolidation or debt settlement options. Understanding how each works is crucial in making the best possible decision.
For Arkansas families depending on credit cards to carry them through the month's spending, it is important to know that experts believe that a large amount of credit card debt can hurt overall credit ratings. The Federal Reserve Bank of New York released figures that show that credit card debt nationwide is now at $700 billion while revolving credit in general tops $887.9 billion. Experts fear that some debtors may be under the mistaken impression that a large credit card balance builds a favorable credit rating.
People in Arkansas who often found themselves reaching for their credit cards in 2014 are part of a national trend. A consumer credit card debt survey sponsored by CardHub reported a big uptick in 2014, with a 47 percent rise in credit card spending from 2013.
Credit card debt is common for many Arkansas residents, and an increase in the interest rate on a card could result in difficulty overcoming such debt for those who may struggle to make even minimum payments. However, there are rules in place that restrict card issuers in their interest rate increases. These restrictions were put in place through the CARD Act of 2009. With recent high-profile changes by American Express, it is important to be aware of how an APR increase might affect one's finances.
Individuals who live in Arkansas may be wondering what the repercussions of debt are and how to get out of debt. People who do not view these outstanding balances as an emergency may not understand that it is a sign indicating that finances might not be healthy, and many Americans view debt as a normal part of life. It is not uncommon for a person to take out a loan on a new car or place daily necessities on a credit card. In fact, the average family has $155,000 in a mortgage, $32,000 in student loans and $15,000 in credit card debts.
While credit card creditors are normally unsecured ones, they may seek to gain a security interest in a debtor's property by filing a civil lawsuit. In the event a judgment is obtained, the creditor may then attempt to enforce the judgment by garnishing wages, levying bank accounts or placing liens against property for the judgment amount.
Data collected in Arkansas and across the nation indicate that has been a wide degree of variation in the amount owed by households that use credit cards. The average American household that holds debt now carries a liability of $15,608. This number has fluctuated substantially over the last decade, but it appeared to have be holding steady over the last four years until it encountered a slight increase in 2014.