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Facts about credit card usage in Texas

Having a credit card is a big responsibility. However, having a credit card does not have to put a person in debt for the rest of their life. In fact, one of the largest myths is that using a credit card means carrying a large balance from month to month. By paying off the debt each month, a person can use credit without paying interest or going into debt.

In some cases, carrying a short-term credit balance is worthwhile. Paying back a debt of $1,000 over a few months may result in a finance charge of less than $50. Paying the balance off may also allow an individual to improve his or her credit score. On the other hand, failing to pay that balance could result in a lower credit score.

Many people find that repaying a balance is difficult. Therefore, it is prudent to charge no more than what could be reasonably paid off in a short period of time. Creating a debt repayment plan prior to going into debt can help make it easier to pay it off as soon as possible. For those who cannot pay, it may be a good idea to ask for a settlement of the outstanding debt. Otherwise, failure to pay that debt could result in a creditor garnishing a debtor's wages.

Filing for bankruptcy may be a legitimate way for debtors to achieve debt relief. The benefits of bankruptcy may include a stay of legal action taken by creditors as well as a stay of any wage garnishment already underway. Those who are considering bankruptcy may wish to speak to a bankruptcy attorney who may be able to talk about additional benefits to taking such action.

Source: Credit cards.com, "8 things you must know about credit card debt ", November 04, 2014

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