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How to handle credit card debt - Chapter 7 bankruptcy and more

Credit card debt is among the most tenacious types of debt one can accrue, thanks largely to the high interest rates associated with credit payment. Some Kentucky residents may be feeling the weight of this debt since the average American household carries some $16,000 in credit debt alone. Thankfully, there are several ways to help discharge credit card debt, from debt consolidation to Chapter 7 bankruptcy. 

Many experts agree that the best first step in addressing debt is to create and stick to a comprehensive budget. Many people have a tendency to treat credit cards as their own money rather than the loan they represent. Sticking to a consistent budget can help curb spending and allows the card holder to create goals for paying down the debt. There are also several other methods to move money around and handle existing debt. 

Taking out a home equity line of credit has the potential to pay down credit debt or pay it off altogether. However, it can also be risky - defaulting on a payment could lead to a foreclosure of the mortgage. Borrowing from a 401(k) and borrowing against life insurance policies are also options, but they come with their own risks as well. 

Paying down credit card debt can seem daunting to many Kentucky residents, but it can be done. For those in particularly dire straits, there is also the option to file for Chapter 7 bankruptcy, which means unsecured debt like credit cards can be forgiven by the court. Seeking the support of a knowledgeable bankruptcy attorney can help ease this process and get individuals and families out from under the shadow of debt. 

Source: wreg.com, "Three non-traditional ways to pay off credit card debt", Eryn Taylor and Zaneta Lowe, Nov. 7, 2017

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