Many people in Virginia are struggling to make ends meet, and they may find themselves stretching their credit card balances in order to do so. Credit card debt is growing across the United States, and the reasons can vary from financial emergencies to appealing offers from credit card companies. According to the Federal Reserve, revolving consumer debt, including credit card debt, increased across the country by 1.5 percent in July 2018. According to the national bank, American consumers’ revolving debt totals $1.037 trillion.
There are several ways that people can find themselves facing greater credit card debt than they anticipated. Many cards offer rewards programs, especially those that feature travel. These rewards programs may allow people to buy travel now with the promise of making up the payments later by accumulating miles on the card. Of course, if the cardholder does not buy enough to accumulate the miles naturally, he or she will need to purchase miles directly from the airline. This cost can push the price of the trip into unaffordable territory that is difficult to pay off in full.
As debt accumulates, people may find it increasingly hard to pay their monthly bills on time. When a credit card payment is late, the risk isn’t just a hit to the credit report or annoying collector calls. Instead, credit card companies can change the terms of the agreement if a cardholder submits a payment 60 days late or more. That new APR, often 29.99 percent, can be applied to the entire balance on the card.
For many people facing staggering credit card debt, they reached this position without realizing just how insurmountable their bills would become. People who are looking for debt relief can consult with a bankruptcy attorney about how Chapter 7 bankruptcy may be a way forward to a new financial future.