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Credit Card Debit

I recently returned to work after a year off maternity leave and our credit card debit is more then we can handle to pay back. I think credit card debit is around $25000. What should we do? We are struggling to make payments and it just keeps getting higher with interest thanks.

Posted from: Ontario

One Response to “Credit Card Debit”

A licensed trustee said...

Start by writing out a detailed monthly budget that shows all of your income and all of your regular expenses. There’s a budget tool on the site you may want to try.

Once you know how much it costs you to live you will be better able to tell hom much you have left over at the end of the month to pay towards your debt.

4 quick options to consider:

Debt consolidation – if you don’t have debts in collections and your budget shows you should be able to afford to repay the debt in full then this solution might work. You go to yoru bank and ask them for a loan or line of credit to repay all of the other debt, leaving you with just the one loan to worry abotu every month. These loans have been difficult to get since Sep 2008 so if you’ve got anything in collections don’t bother trying this solution.

Credt Counseling – a voluntary program where you repay your debt in full over 4 or 5 years, but usually without any new interest charges. So take what you oiwe and divide it by 48 (or 60 months). That will be your payment in this kind of plan – if your budget shows you can afford this payment then you should look into this further.

A consumer proposal – a legla procedure where you offer to repay part of your debt (usually at least 1/3 of what you owe). So take your debt, divide it by 3 and then divide that number by either 48 or 60 months. This is likely what your payment will be in a consumer proposal. If you can afford this payment then you should look further into this solution.

Bankruptcy – if none of the other solutions will work then you may need to consider this option.

This may all seem a bit overwhelming – if it is, or you simply need some help dealing with this you may want to simply use the links on this site to find a trustee in bankruptcy in your area. By law trustees are required to review all of these options with you so that you can make an informed decision about the one that is right for you.