Have you ever been in a situation of paying for years on credit card debt where the balance is relatively low but the debt never goes away? It’s designed that way by the credit card companies. It’s designed to keep you in debt for a lifetime through high interest, escalating interest, late fees, over the limit fees and some have fees on top of this. It’s called DPR (daily percentage rate) in addition to the APR. DPR is used by hard money lenders or predatory lenders.

 

I was personally a victim the credit pull back in 2008. What that means is if you had a line of credit or credit card limit of $10,000 (or less), 50% was pulled back. In my case, I had used $5500 of the $10K. $5K was pulled back and now I was $500 over my credit limit and it negatively impacted my credit score. Prior to the pull back, I used a little over 50% of my credit; after the pull back, I was maxed out. That caused the interest to increase from 8% to 29%. Instead of paying the minimums, I’d pay 10% over the minimum payment to pay down some of the principle. After the pull back, that 10% was only part of the minimum due.

 

Most of us don’t mind paying our bills, but we do mind being cheated at the highest level allowed by the law.

 

	Debt Settlement		Bankruptcy	Credit Counseling	Consolidation	Minimum Monthly Payments
Debt Amount	$25,000		$25,000	$25,000	$25,000	$25,000
Amt Repaid	$10,000		$22,500	$25,000	$25,000	$25,000
Monthly Payment	$452		$806	$570	$361	$563
Interest Rate	Not a Factor		Not a Factor	13%	11%	18%
Years to Pay in Full	3		3	5	10	43
Negative Impact on
Credit Score in Years	duration of program		10 Years	7 Years	10 Years	43 Years.
Totals
Debt Amount Repaid	$10,000		$22,500	$25,000	$25,000	$25,000
Fees	$3,750		$4,000	$3,000	$2,000	$0
Accrued Interest and Penalties	$2,508		$0	$6,149	$16,326	$48,809
Grand Total Repaid	$16,258		$26,500	$34,149	$43,326	$73,809