Hi, I’m desperate because I owe 5,000$ in my two credit cards, what can I do?

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Hi, I’m desperate because I owe 5,000$ in my two credit cards, what can I do?

Right now I’m unemployed, and all the interests and fees are accumulating. I didn’t pay two months. What can I do to reduce my interests and fees?

Asked on June 23, 2009 under Bankruptcy Law, Florida

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

First, you can contact your creditors and try to negotiate something--a reduction in the amount owed, longer payment terms, a lower interest rate, etc.--with them. There's no guarantee they'll do so, but most lenders are practical, and know you can't get blood from a  stone; they'd rather negotiate something that lets you pay than have you default entirely.

Second, you could declare bankruptcy. That is a serious option, as it affects your credit rating, ability to get credit, etc. However, if you have much more debt than you have assets, it may make sense to do so.

In the meantime, try to pay at least the minimum amounts if you can, while you work out a longer-term solution; you don't want to go into default, which may affect credit, trigger higher interest rates, and put you into collections. 


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