Sunday, May 22, 2016

Is moving your money to new lower rate accounts really helping ...

Image courtesy of phanlop88 at
It seems to me unsecure credit is really starting to open up and some creditors are really trying to get their cards into people's hands. Many times these cards with ultra low or no interest for a year or more. So what do people do if they have large credit card debts. They seem to move it to low interest cards. That may be a good idea; if they actually use the money they are saving on interest to pay down the principal debt on the card.

Unfortunately, many people use the reduced payments on the debts as extra spending money. What they do not realize is the interest payment that comes after the promotion period. After time, they end up building new debt on the old cards while barely making a dent in the transferred debt. Before the debtors know it, they have maxed out both the new and old cards and in deeper than ever before.

I you are thinking about moving debt to new low interest rate cards, make sure you afford to place all the savings back into paying the debt. Otherwise, you will just prolong the inevitable. You will continue to build debt with no hope of getting out. You will dodge creditors for another year or two. Finally, you will end up at the point you were trying to avoid; bankruptcy. If you are in too deep so cannot afford to pay the extra on your debts, don't do it.

Remember, "Let me tell you about the law of holes: If you find yourself in a hole, stop digging." The part after the colon in that version has also been attributed to American humorist Will Rogers.

If you want assistance, legal representation, or just want to know more about Mark Medvesky or our firm of Wells, Hoffman, Holloway & Medvesky LLP, check out our website at

#bankruptcy #Chapter7 #Chapter13 #MontgomeryCounty #lawfirm #BucksCounty #Pennsylvania

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