Look Out for These Signs that You’re in Debt Trouble
Making responsible use of a credit card can help you build a strong credit score. It can help make you an excellent candidate for larger lines of credit down the line, such as home loans or a loan to start a small business. But sometimes, a lack of money literacy or a tragic life event can cause consumers to lose control of their debt, which for many results in quickly-ballooning debts and an inability to get caught up. It’s important to know when it’s time to get professional help with your debt, so that you can get back on track to a stronger financial future as soon as possible. In fact, the earlier you seek professional advice, the more options you will likely have on how to deal with your expanding debt. Check out our list below of signs that your debt has gotten out of control, and speak with a Ventura bankruptcy lawyer with any additional questions you may have.
You need to use money from a savings or retirement account to pay for regular monthly expenses: If you’re consistently spending more than you earn, it won’t take long for your debt to spiral out of control.
You have multiple credit cards that are all near their limit: If you spread your debt across multiple credit cards, but have little credit left for additional charges, then it is unlikely you’re able to afford your debts based on your income. Without a reduction in debts or an increase in income, you’ll soon be unable to keep up with your monthly bills.
You use money from one line of credit to make payments on another. This is yet another sign that your amount of income is insufficient to support your monthly expenditures. Plus, if you’re using cash advances on credit cards, they often come with much larger interest rates than the rate charged on regular purchases, so by doing this you may be causing your debt to increase much faster.
You only make the minimum payment (or less) on your credit cards each month. The minimum payment on a credit card is typically set at a low-enough amount that the debtor won’t soon pay off the debt, and the credit card company will be able to impose more in interest charges. If you’re struggling to make the minimum payment, then your debt is quickly going to grow out of control.
For help finding a way out of massive amounts of debt in California, contact the Ventura offices of Rounds & Sutter for a free consultation at 805-650-7100.