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Clearing your credit cards
If you have credit card debts that are costing you a small fortune each month and you never seem to be able to get in front with the payments this page is for you. We have listed below the main ways of getting rid of credit card debt and getting them once and for all.
The quick way to clear your credit cards
Consolidate credit cards with a new loan or mortgage
Clearing your credit card debt with a new loan or mortgage may be an option if you are able to qualify for the lenders borrowing criteria.
For credit cards debts in excess of £10,000 to £15,000 the chances are you will need to apply for some form of secured lending such as a secured loan or remortgage. Consolidating credit cards with a remortgage will usually be an option if you have substantial credit card debts.
The benefits of a secured loan or remortgage is that the interest rates are typically lower than that of an unsecured loan as there is less of a risk for the lender (as the loan is secured on property). This also has its downside though, if the mortgage or secured loan is not repaid the lender has more rights when it comes to recovering the money so its essential to make sure any new mortgage or secured loans are affordable - although you wouldn't have your credit card debts any more which will often cost more each month than comparable secured funding.
If you have missed payments and are looking to repay all your credit cards as the monthly payments are not affordable you may have to apply for what is termed as an adverse credit mortgage, an adverse credit mortgage may allow you to repay your credit card debts even if you have missed payments. Repaying your credit cards with an adverse credit mortgage will mean you may be increasing your debt with a new loan but will also mean that the debts are repaid instantly which should help towards clearing up any bad credit or poor repayment history listed on your credit file.
Get rid of credit card debts via debt management
Getting rid of your credit cards with debt management may be a better option for you.
Wrapping up your credit card debts in a debt management plan can help reduce your monthly payments to your creditors and help clear the credit cards once and for all over a period of time. One of the benefits of a debt management plan is that you do not increase your borrowing with a consolidation loan, although it will normally have an adverse effect on your credit rating as the credit card companies may register defaults against you after you enter into a debt management plan, the debt management company will also be able to speak to your credit card companies and hopefully stop any further interest and charges being added to your account, meaning you will be able to repay your credit cards faster as the amount owed will not be increased with additional charges and interest.
