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There was a rapid decline in earnings causing many credit card debtors to avoid payment of dues.
The defaulters increased leading the banks to go bankrupt.
Most of the credit card debts are unsecured.
This means that that the lender has no security cover if you have not paid up the debts.
Since the loans are unsecured the lending rates also high.
Along with the lending rates credit cards also have some other hidden charges which most are ignorant of.
These are the reasons why credit card debts accrue without your realization.
If you have unsecured debts over $10K, there are ways to legally eliminate the debts.
This article explains how legitimate means can be used to seek debt relief.
First of all you must understand that it is not necessary to pay all those installments or aim at stashing off all the dues, especially if you do not have the financial resources to do so.
You have an opportunity to legitimately reduce the amount you owe to the creditor.
Let's consider a hypothetical situation where you have lent money to someone unfamiliar.
This is an unsecured loan as you have no guarantee that your money will be returned.
To take it a step further lets assume that you have lent money several times to the same person.
When the debtor (the person to whom you have lent money) refuses to pay for whatever reasons, your eagerness to get back the money lent increases.
If the debtor is in a financial mess it makes it all the more difficult for him to pay back.
Applying the same analogy, when we replace your position with the financial institution and the debtors' position with yours, the bank will be very much eager to make a collection instead of landing up having nothing.
So they usually are willing to offer a rebate if you have high unsecured debts, have defaulted many times and are in a bad financial shape.
To get this rebate on your net debt, you need expert advice and support.
Doing this on your own is very much possible but you will not be able to negotiate a good deal simply because you do not have the experience dealing with credit card companies.
This is the reason why it's always a safe option to work with a debt relief firm.
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