Reducing Credit Card Debt The Easy Way

Saving money is certainly very tough these days. Especially when you start to factor in bank and credit provider charges with the interest rates they already charge. These additional charges will suck the life out of you! Some of the things these organizations think of to charge you for are amazing, and many bank and credit card charges have been heavily criticised by consumer watchdogs like Consumer Affairs of Fair Trading Departments all over the world. Go over your limit and you'll be slugged with a huge fee, make a payment late and ditto. Pay over the counter and some will even charge you!

It takes me back to my Grandfather and some of his many words of wisdom. 'Never get into debt unless it's to buy a house', was him at his most sage like.

Now before all the bank lovers out there (bank employees) charge into a song about a bank's right to do this and that after my first paragraph, let me ask you people how a bank justifies a $40 charge for a late fee when they're already slugging the customer with interest!

Case Study: Moi

I had a good history with a credit card company who recently cancelled my account because they said my payment was late. I'd been with this company for around 10 years without missing a payment and amassed around a $6.5K balance. When I changed bank accounts and tried to change direct debit details they lost my information. A big enough concern when you consider the risk of identity theft.



As I tried to discuss the issue with the company they sold my debt to a third party. A collection organisation who were very hostile to say the least. That collector promptly sent me one of those letters demanding payment before they take legal action, unleash the hounds of hell and sacrifice my soul to the bank gods.

My reaction was Callahan-esque. I rang them and basically told them to 'Go ahead and make my day'! Then I rang the Fair Trading Department and complained.

My husband's response was probably the most unsettling of all. "No more shoes on the credit card for a while, " He said, attempting to hide his amusement. Does he think I'm Sarah Jessica Parker or something?

Due Process

After contacting the Fair Trading Department the debt collection organisation was unable to continue their strong-arm tactics while the whole mess was looked at. This allowed me a little breathing space and stopped the collectors racking up late charges and any other charge they could think of.

After a few weeks of information going back and forward, the company involved started to back off a little and suggested a 'settlement'. This was quite a turn around when you consider the tough talk they had started out with, wanting me to either write them a cheque there and then for the 6.5k or organise a new loan through them at a much higher interest rate.

"Could you pay 4k?" They asked.

I nearly choked. Two and a half thousand saved off my credit card debt if I could settle, that's one heck of a discount! Hard-working husband was suitably impressed as well.