Holiday Debt

So, the Holiday season has come and gone, and now we are faced with the task of paying off all of that debt. Many people have been pulled into the 0% introductory rate credit card that we have discussed in a previous post, or just used a current credit card with a low fixed rate. Either way, we want to be sure to pay the balance on the cards sooner than later.

The first piece of advice would be to always pay more than the minimum due on your credit card statement. In most cases, the minimum amount due mostly covers the interest due from the previous cycle period, and very little going to pay off the principal balance. For example, if you have a payment due of $45.00, make a payment of $75.00 or $100.00. This will significantly cut the amount of time you have to pay on your existing balance.

Also, look for ways to adjust your budget to allow yourself to apply extra funds to that credit card debt. Excessive credit card debt and high balances are one of the main deterrents in loan qualification.