Rising Rates on Credit Cards May Push More Consumers to File for Atlanta Bankruptcy
Rates on mortgages and car loans may be hitting all-time lows, but credit card rates are only getting higher.
Worst of all, say Atlanta bankruptcy attorneys, the highest rates are being levied on those most likely to rely on credit to make ends meet, often resulting in unmanageable debt.
According to SmartMoney, interest rates on student credit cards now average 16.3 percent, up from 15.8 percent just three months ago.
Rates on secured credit cards, which are typically issued to people with a poor credit score or little credit history, have shot up from 17.7 percent to a whopping 19 percent.
Meanwhile, retailers are looking for ways to charge higher rates for purchases made with credit cards in order to recoup fees levied on them by credit card companies.
One of the reasons for the increase is that, after several years of tightening the reins on credit, lenders are once again offering cards to riskier borrowers. In addition, credit cards are unsecured - meaning banks can't collect collateral when a borrower defaults on his or her debt.
As a result, all of us must balance out the heightened risk with higher costs.
Rising rates are more than just a hassle. Though they aren't directly related, credit cards often impact consumers' ability to manage other areas of their finances. For many of us, our monthly credit card bills determine whether we'll be able to make the mortgage payment or pay for student loans.
As credit card debts - and monthly payments - grow, borrowers are forced to rely on more debt to stay financially afloat. It's a vicious cycle that can result in harassment from bill collectors, ruined credit, and foreclosure. The good news is that, in many cases, bankruptcy can help.
Chicago bankruptcy has the power to relieve unsecured debts, lowering credit card bills and putting more money in your pocket for other necessary expenses.
Unlike debt settlement plans and other programs, filing for bankruptcy in Tennessee and other U.S. states grants the legal protection needed to escape from crushing debt while also protecting your home from foreclosure.
If you're tired of being at the mercy of creditors, bankruptcy can provide the leverage you need to conquer debt and take back your finances.
If you would like to learn if bankruptcy is right for your financial situation, call the DebtStoppers Bankruptcy Law Firm at 800-440-7235. Call now for a free personal debt consultation with one of our professional bankruptcy attorneys in Chicago, Atlanta, and Tennessee.
More Blog Entries:
Healthcare Reform Has Pros, Cons for Cash-Strapped Consumers with Debt in Chicago, Atlanta & Tennessee: July 6, 2012
Senior Citizens Who Drain Savings Helping Kids, Grandkids May Face Tennessee Bankruptcy: June 28, 2012
Additional Resources:
Credit Card Rates Rise Again, by AnnaMaria Andriotis, SmartMoney