Industry experts have been urging consumers in the UK to take control of the spiraling debt being accumulated on high interest credit cards.
June 26, 2007 (Press Release) --
Many customers that use credit cards make the minimum required payment per month leading to a tiny reduction in the actual debt and end up paying a small fortune in interest and charges.
The other trend is to churn the cards via the balance transfer opportunities. However, there is always a transfer fee and any extra debt, which accrues interest, put onto the card will be paid off before the interest free part. As the debt is interest free the monthly payment can sometimes be just £5 per month, whatever the balance.
A £3,000 credit card with a 3% minimum payment would take over 20 years to clear, assuming the minimum each month was paid and no further borrowing was taken out.
Credit cards have always had the reputation of having high interest rates, however, since the recent introduction of ceiling limits on additional fees that can be charged card issuers have introduced a number of ways to try to catch up their lost revenue:
§ Increased interest rates
§ Higher fees for using the card abroad
§ Penalty fees for exceeding credit limits
§ Late payments.
Are all strategies that credit card issuers are using to increase their profits.
With the charges and interest on credit cards, it's easy to see how a consumer can very quickly lose control of their finances leaving a debt problem that potentially could last for years. Once in this position the consumer must consider a change in their spending habits or consider getting rid of their cards, and other unsecured debt, and seriously consider the benefits of a secured consolidation loan instead.
Sunflower Loans are an independently owned finance broker. We have been in business for 7 years. We are regulated by both The Finance Industry Standards Association and the FSA.
We have vast experience in helping people with a range of debt problems - for example, county court judgments, mortgage arrears and IVAs . We have companies who are able to help in these circumstances.
The other trend is to churn the cards via the balance transfer opportunities. However, there is always a transfer fee and any extra debt, which accrues interest, put onto the card will be paid off before the interest free part. As the debt is interest free the monthly payment can sometimes be just £5 per month, whatever the balance.
A £3,000 credit card with a 3% minimum payment would take over 20 years to clear, assuming the minimum each month was paid and no further borrowing was taken out.
Credit cards have always had the reputation of having high interest rates, however, since the recent introduction of ceiling limits on additional fees that can be charged card issuers have introduced a number of ways to try to catch up their lost revenue:
§ Increased interest rates
§ Higher fees for using the card abroad
§ Penalty fees for exceeding credit limits
§ Late payments.
Are all strategies that credit card issuers are using to increase their profits.
With the charges and interest on credit cards, it's easy to see how a consumer can very quickly lose control of their finances leaving a debt problem that potentially could last for years. Once in this position the consumer must consider a change in their spending habits or consider getting rid of their cards, and other unsecured debt, and seriously consider the benefits of a secured consolidation loan instead.
Sunflower Loans are an independently owned finance broker. We have been in business for 7 years. We are regulated by both The Finance Industry Standards Association and the FSA.
We have vast experience in helping people with a range of debt problems - for example, county court judgments, mortgage arrears and IVAs . We have companies who are able to help in these circumstances.
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