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Crush Credit Card Debt, Get Your Dream Home

Did you know that while in college, students receive approximately one pre-approved credit card

solicitation a day and 47% of seniors graduate with credit card debt? Did you also know one of the

biggest barriers to home ownership mentioned by first time homebuyers is credit card debt? Don’t let

credit card debt get between you and your dream home. Here are some suggestions for reducing credit

card debit and moving closer to your dream of home ownership.

 

Stop spending: According to creditcards.com the average American is actively spending on four credit

cards monthly. Do your best to reduce spending on the plastic. Lock them in the safe, stick them in the

freezer whatever you have to do to keep from using them. Keep one around for emergencies and tuck the

others away.

 

Figure out your payoff personality. What type of person are you? Do you prefer to pay down bills

quickly and to go for the biggest monster, or does it feel better to be fair and pay everyone the same?

While it may seem counter-intuitive, if you like to see fast results, start putting extra money on the card

with the smallest balance while continuing to pay at least the minimum balance on your other cards. Once

that one small-balance card hits zero, take that extra money and apply it to the card with the next-smallest

balance. Soon you will see a snowball effect of zero balances that add to the motivation when the bigger

balances come up.

 

Consider the interest. If high interest makes your stomach churn, start working on the card with the

highest interest rate. This makes sense, as the higher interest rate causes the most financial pain. Do you

have any extra money at the end of the month? Take that $50 to toss at your credit card. The average

interest rate on a card is 15.2 percent, and only about 5% of balance is tackled in your minimum payment.

It can take 65 Payments at the minimum payment to pay off $1000! So, all those extra payments will

only help.

 

Power down the debt. Consider consolidating all your credit card debt into one “0% interest” card. Many

companies offer a long term 0% interest promotion if you transfer over a credit card balance from another

card. For the credit card company, the incentive is interest at the end of the promotion. For you, it could

mean lower combined payments. You will have to absorb the interest from the former balances, but you

will have no new accruing interest for 12 to 18 months.

 

No matter how you decide to crush your credit card debt, once you follow through, you will feel like you

have made some great moves towards home ownership.

 

Are you ready to buy your first home? Find out. Contact the Chris Colgan Team. We are here to answer

any real estate questions you have and get you into your new home smoothly. Let us help you seal a deal.

 

Chris Colgan is the CEO and Team Leader of the Chris Colgan Real Estate Team. Chris

was born and raised in Gainesville, Virginia and has been in real estate for 10 years. He is a

member of the Re/Max Hall of Fame and is in the top 25 for sales in the state of Virginia out of

all Re/Max agents. He has been recognized as one of the United States’ and Canada’s Top

500 Marketing Experts by the National Association of Expert Advisors.

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