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(image: https://burst.shopifycdn.com/photos/dirt-path-reaches-along-line-of-florida-orange-orchard-trees.jpg?width=746&format=pjpg&exif=0&iptc=0)How settling a car loan affects your credit Advertiser Disclosure Advertiser Disclosure We are an independent, advertising-supported comparison service. Our aim is to assist you make better financial choices by offering financial calculators and interactive tools, publishing original and objective content. This allows users to conduct research and compare information for free to help you make sound financial decisions. Bankrate has partnerships with issuers such as, but not limited to, American Express, Bank of America, Capital One, Chase, Citi and Discover. How We Make money The products that appear on this website are provided by companies who pay us. This compensation can affect the way and where products appear on this site, including, for example, the order in which they may be listed within the categories of listing, except where prohibited by law. This applies to our mortgage, home equity, and other home loan products. However, this compensation will not influence the information we publish, or the reviews that you read on this site. We do not cover the vast array of companies or financial offers that may be accessible to you. SHARE Demaerre/Getty Images

3 min read Published September 19 2022

Written by Emma Woodward Written by Contributing writer Emma Woodward is a former contributor for Bankrate and freelance writer who loves writing to help people understand personal finance issues. She has written for businesses and publications such as Finch, Toast, JBD Clothiers and The Financial Diet. Written by Rhys Subitch Edited by Auto loans editor Rhys has been writing and editing for Bankrate since late 2021. They are passionate about helping readers feel confident to take control of their finances with concise, well-researched and well-studied information that breaks down otherwise complicated topics into bite-sized pieces. The Bankrate guarantee

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At Bankrate we aim to help you make better financial decisions. We adhere to the highest standards of ethical standards ,

This article may include the mention of products made by our partners. Here's a brief explanation of how we make money . The Bankrate promise

In 1976, Bankrate was founded. Bankrate has a long track record of helping people make informed financial decisions.

We've maintained this reputation for over 40 years by simplifying the process of financial decision-making

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so you can trust that we're putting your interests first. All of our content was created in the hands of and edited by

They ensure that what we write will ensure that our content is reliable, honest and trustworthy. Our loans journalists and editors concentrate on the things that consumers care about most -- the various kinds of loans available and the most competitive rates, the best lenders, the best ways to pay off debt , and many more. So you're able to be confident about making a decision about your investment. Editorial integrity

Bankrate has a strict policy , so you can trust that we put your interests first. Our award-winning editors and reporters produce honest and reliable information to assist you in making the right financial choices. The key principles We respect your confidence. Our mission is to offer readers truthful and impartial information. We have editorial standards in place to ensure that happens. Our reporters and editors thoroughly fact-check editorial content to ensure that the information you're reading is correct. We keep a barrier with our advertising partners and the editorial team. The editorial team of Editorial Independence Bankrate does not receive any direct payment by our advertising partners. Editorial Independence Bankrate's editorial staff writes in the name of YOU - the reader. Our aim is to provide you the best advice to help you make smart personal finance decisions. We follow strict guidelines for ensuring that editorial content is not influenced by advertisers. Our editorial team is not paid direct compensation from advertisers, and all content is checked for accuracy to ensure its truthfulness. Therefore, whether you're reading an article or reviewing, you can trust that you're getting reliable and dependable information. How we earn money

You have money questions. Bankrate can help. Our experts have been helping you manage your money for over four decades. We strive to continuously provide consumers with the expert advice and tools needed to make it through life's financial journey. Bankrate adheres to a strict code of conduct standard of conduct, which means that you can be sure that our information is trustworthy and reliable. Our award-winning editors and journalists produce honest and reliable content to help you make the best financial choices. The content we create by our editorial team is objective, factual and uninfluenced by our advertisers. We're open about the ways we're capable of bringing high-quality information, competitive rates and practical tools for you , by describing how we make money. Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated in exchange for the placement of sponsored products and, services, or through you clicking specific links on our website. So, this compensation can affect the way, location and in what order items are listed in the event that they are not permitted by law. This is the case for our mortgage or home equity products, as well as other home lending products. Other factors, such as our own proprietary website rules and whether a product is available in the area you reside in or is within your self-selected credit score range can also impact how and where products appear on this site. We strive to provide the most diverse selection of products, Bankrate does not include information about each credit or financial product or service. Making a decision to take out an auto loan is a tough decision to take. It can affect your credit score, and can affect your chances of getting another loan or to open another credit line. Most people want to avoid an . However, sometimes there's just no other option. Making a loan requires the involvement of a dealer to act as a bridge between you and the lender. They may be able to negotiate a lump sum amount that is lower than the total amount of your car loan when you pay it by a specified date. Before making this decision, it's important to understand both the advantages and disadvantages to your financial and financial goals plus your current financial situation before deciding which option to take. Settling an auto loan could affect your credit score. If you settle the car loan and it is settled, the immediate effect to your credit scores is negative. The amount that decreases will vary. In general, the better your score at beginning and the higher it will fall if you decide to settle your loan. But, settling your auto loan might be the best choice over the long haul. Your credit score gets affected each time you fail to make an loan payment. If you're struggling to pay your bills on time and can't , settling your auto loan can allow you to start rebuilding your credit. Once the loan has been paid off, your credit score may initially drop but it is something you can then concentrate on . It is possible to make other payments on time or pay off other debts , and improve your credit score again. The opening of a new account could affect your credit score, therefore you may want to avoid any new accounts until you're credit score is in better shape. The account that is settled will be on your credit score for seven years following the original delinquency date. That may seem like a lengthy time, but remember that it's better than numerous late payments that accumulate on your credit report. Additionally, you'll be taxed on the forgiven loan It's worth noting that if you are involved in an auto loan settlement that is not more then the total amount of loan in itself, the lender usually will write off the difference. That amount is considered taxable income to the IRS and, therefore, you'll have to pay federal tax. The 1099-C cancellation of debt tax notice from your creditor. The notice will let you know how much you have to pay taxes on. Since it is taxed like income it will be taxed at the tax bracket of your income that you are in. Car debt settlement vs. repossession Settling your car loan is different from . In an auto loan settlement, you sign a contract in writing with your lender for the payment of a percentage of your original debt. The debt is then as settled. But, you'll still be required to pay tax on the forgiven debt. When you are repossessed the lender will return your vehicle and offer it for sale to pay off some, or even all your loan credit. If the car is sold at a lower price than the amount of the debt, you could still have to pay the lender. This is called an indeficiency settlement. You can turn in your car and . The lender may also be able to take possession of your car without your permission if you do not make your loan payments. Both the process of settling your debts and repossession can affect your credit score in a negative way. And, since late payments often precede both, you may have multiple negative marks in your history with credit. Possession could lower the credit rating by 100 points or higher. The best way to protect your credit is always to pay off your outstanding debt completely, but this is typically too big of a request. If you can't accomplish that, then work together with the lender to determine the most effective solution. It is possible to determine what would be most suitable for your particular situation. Six options to settle your car loan You can pay off the loan entirely. in full is always the best choice for your credit. Modify your car loan. Based on your circumstances you may be eligible to . Contact your lender to find out how you can modify the terms of your loan. Trade in your vehicle. If your vehicle loan is too expensive look into buying an older vehicle. This may result in a lower monthly payment for your car loan. Sell your vehicle. If you're able to get around without a car, even for a short time, you might want to think about . Let your car be taken away. Vehicle repossession also negatively impacts your credit, but it's better than settling your car loan. Talk to a credit counselor to determine the best choices to improve your credit. Apply for bankruptcy. If your car payment isn't the only financial problem you face it's possible to file for bankruptcy . It could affect your credit in the ten years following, so it's not something you want to take on if you have other alternatives. The bottom line Settling the terms of a car loan can be intimidating, but improving your situation now can help you save money over the long term. Be aware of your options before you settle your car loan, as it will impact your credit score for the next seven years. If you're not sure how to proceed, consider consulting with a credit advisor. Find out more

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Written by the contributing author Emma Woodward is a former contributor to Bankrate and a freelance writer who loves writing to demystify personal finance topics. She has written for various companies and publications like Finch, Toast, JBD Clothiers and The Financial Diet. Written by Rhys Subitch Edited by Auto loans Editor Rhys has been writing and editing for Bankrate from late 2021. They are enthusiastic about helping readers gain the confidence to manage their finances with clear, well-researched details that cut otherwise complex topics into manageable bites.

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Similar Articles: Auto Loans 4 min read January 13, 2023. Auto Loans 5 min read Jan 12 2023 Auto Loans 5 min to read Nov 15, 2022 Loans 4 minutes read Sep 12, 2022

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Credit Card Vs. Credit Card: What is Safer on the Internet?

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Credit Card Vs. Debit Card: Which Is More Secure on the Internet?

When you commit fraud with your credit card the money of the card issuer is at risk. With debit card fraud the money you have paid for is stolen.

By Kevin Cash

Updated Nov 9, 2022 1:13PM PST

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If you frequently use a debit card for online purchases, you may be thinking about reconsidering. If your card information is hacked and purchases are made without your authorization It's easy to discover that credit and debit cards are treated quite differently.

The main difference is that with credit cards, the card issuer must fight to get its money back. With a debit card, you have to fight for your money back.

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How is fraud dealt with

If your credit card information was stolen, and possibly fraudulent transactions have occurred, protect your rights. In the case of credit cards, the primary legislation is known as the Fair Credit Billing Act, or FCBA. When it comes to debit card transactions, the Electronic Funds Transfer Act (EFTA) applies. While these laws offer some similar protections, knowing the distinctions is crucial in understanding why it's better to use one kind of plastic over the other.

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Fraud on debit cards

In accordance with the EFTA, your potential liability for fraudulent transactions with debit cards is almost indefinite. You have until 60 days in which to file a report of a lost or stolen card in accordance with the EFTA. Then, you have to pay back the amount you were taken, even funds siphoned from linked accounts. The liability limits that are specific to the EFTA are:

The card that was stolen or lost is reported prior to transactions that were not authorized: no liability.

Lost or stolen card not reported within 2 days The liability limit is $50.

Card stolen or lost reported within 60 days The liability limit is $500.

After 60 days: no protection.

It's important to know that if your card is not lost physically or stolen, you have 60 days to report fraudulent transactions without liability. If only your card number has been stolen, the 60 days begin on the date on the statement on which a fraudulent transaction is noted.

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Fraud with credit cards

Under the FCBA The maximum liability you can incur for fraudulent transactions on credit cards is $50. If you notify your card lost or stolen before fraud occurs, your liability is zero. A lot of credit cards offer zero liability for all fraudulent transactions.

"I've been the victim of having my credit card information stolen and used fraudulently a number of times," says Tucker Spillane an experienced credit analyst of 24 years old from New York. "Fortunately my card issuer nearly always picks up on the fraud immediately ... usually because the behavior is abnormal from my typical spending practices. And they provide their own insurance against fraud. I've never had to pay a dime."

The real difference between a debit and credit card when it comes to fraud lies in the way you get your money back. When a fraudulent transaction occurs on your credit card you will not lose any amount. You can report the fraudulent transaction and receive a credit on your statement, and the problem will never impact the balance of your bank account.

When you use a debit card the bank account balance is affected at the time the fraudulent transaction takes place. If the transaction is significant, you could experience the domino effect of financial problems. Fraudulent charges may entrap funds, causing legitimate charges are denied or trigger overdrafts.

>> MORE:

If you don't have a credit or debit card...

Although credit cards are a better bet for spending online but it is possible that you do not possess one. If this is the case, there are still ways to safeguard yourself against fraud.

A low balance in the account linked to the debit card you use to make online purchases can help reduce the amount of fraudulent withdrawals in the event that they happen. While this won't stop anyone in your accounts from accessing it, however, it could reduce the damage caused by a fraudulent withdrawal.

You might also wish to disable any form of (should you have the feature) your account used to purchase. A lot of banks provide this feature (usually on an account that is a checking one) that automatically takes money from a savings account in the event that the checking account is overdrawn. In the event of fraud, this essentially means the crook is able to access two accounts instead of just one. If you do have an overdraft protection in place, be certain to speak with your bank about the best way to use it and when it is applicable.

Another option to reduce your risk is to make use of an pre-paid debit card. If someone does gain access to the account, they'll be able to access only to the amount you've loaded on the card.

The bottom line

From a legal standpoint In general, credit cards offer greater protection against fraud. But, there are ways to mimic the protections of the use of a debit card or prepaid card. Deciding which is best for you can help safeguard your cash, whether you're shopping on the internet or in a store.

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Hybrid vs. electric: How to choose Advertiser Disclosure Advertiser Disclosure We are an independent, advertising-supported comparison service. Our aim is to assist you make better financial choices by offering you interactive financial calculators and tools that provide objective and original content, by enabling you to conduct research and evaluate information for no cost - so that you can make financial decisions with confidence. Bankrate has agreements with issuers such as, but not limited to American Express, Bank of America, Capital One, Chase, Citi and Discover. How We Earn Money The deals that are advertised on this site come from companies who pay us. This compensation can affect the way and where products are displayed on this website, for example for instance, the sequence in which they be listed within the categories of listing, except where prohibited by law. This applies to our loan products, such as mortgages and home equity and other home loan products. However, this compensation will affect the information we provide, or the reviews you see on this site. We do not cover the vast array of companies or financial deals that may be available to you.

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4 min read Published January 12, 2023

The story was written by David McMillin. by a contributing writer

David McMillin is a contributing writer for Bankrate and covers topics like mortgages, credit cards tax, banking, and travel. David's goal is to help readers discover ways to save money and worry less.

Editor: Rhys Subitch Edited by Auto loans editor

Rhys has been editing and writing for Bankrate from late 2021. They are dedicated to helping readers gain confidence to manage their finances with concise, well-studied and well-researched content that breaks down otherwise complex subjects into bite-sized pieces.

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At Bankrate we are committed to helping you make better financial choices. While we adhere to strict journalistic integrity ,

This article may include the mention of products made by our partners. Here's a brief explanation of how we earn money .

The Bankrate promise

Founded in 1976, Bankrate has a long experience of helping customers make informed financial decisions.

We've earned this name for more than 40 years by making financial decisions easy to understand

process and giving people confidence in the decisions they will take next. Bankrate follows a strict ,

You can rest assured that we'll put your interests first. All of our content is written by and edited by ,

They ensure that what we write is objective, accurate and reliable. We have a team of loans reporters and editors are focused on the things that consumers are most concerned about the most -- different types of lending options, the best rates, the best lenders, how to pay off debt and much more. So you'll be able to feel secure when investing your money.

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Bankrate has a strict policy standard of conduct, which means you can be confident that we're putting your interests first. Our award-winning editors and journalists create honest and accurate content to assist you in making the right financial decisions. Key Principles We value your trust. Our goal is to offer readers accurate and unbiased information. We have editorial standards in place to ensure that happens. Our reporters and editors rigorously fact-check editorial content to ensure that what you read is accurate. We keep a barrier between our advertisers and our editorial team. Our editorial team does not receive direct compensation by our advertising partners. Editorial Independence Bankrate's team of editors writes for YOU who are the readers. Our aim is to provide you the most accurate guidance to make wise financial choices for yourself. We adhere to strict guidelines in order in order to make sure that the content we publish is not affected by advertisements. Our editorial staff receives no direct compensation from advertisers, and all content is fact-checked to ensure accuracy. Therefore, whether you're looking at an article or review, you can be sure that you're getting credible and dependable information.

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If you have questions about money. Bankrate can help. Our experts have been helping you manage your money for over four decades. We strive to continuously provide our readers with the professional advice and tools needed to be successful throughout their financial journey. Bankrate follows a strict policy, so you can trust that our content is truthful and precise. Our award-winning editors and journalists provide honest and trustworthy content that will help you make the right financial decisions. The content we create by our editorial staff is factual, objective and is not influenced by our advertisers. We're open regarding how we're capable of bringing high-quality information, competitive rates and useful tools to you , by describing how we make money. Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated in exchange for the placement of sponsored products and, services, or by you clicking on specific links on our website. Therefore, this compensation may affect the way, location and in what order products appear in listing categories, except where prohibited by law for our mortgage or home equity products, as well as other home loan products. Other factors, such as our own website rules and whether or not a product is available within the area you reside in or is within your own personal credit score can also impact the way and place products are listed on this site. While we strive to provide the most diverse selection of products, Bankrate does not include specific information on every credit or financial product or service.

If you're in the market for new car You might be considering a different approach to driving that requires fewer- or no -- visits to the gas station. As more car manufacturers unveil new models powered by electricity, motorists are contemplating switching to electric. Research from the National Institute of Standards and Technology shows an average of 42 percent Americans are at a minimum likely to consider an electric car the next time they purchase something new for their garages. If you're part of that crowd, there is more important question to answer. Do you need to leave some space to fill up with gas or invest all-in on electric? Compare the upsides and downsides of hybrid versus electric vehicles before you head to the dealership. The differences between hybrid and EV Hybrid cars as well as plug-in hybrid vehicles as well as electric cars (EVs) each made to aid you in curbing or reduce fuel expenses. But there are some key differences between them to know about. Hybrid models may use gasoline or electricity as a energy source. They're equipped with an electric motor as well as an engine powered by gasoline that operate together to power the vehicle. Plug-in hybrid models are similar to hybrid vehicles, but come with a large rechargeable battery. If you operate the vehicle when the battery is charged up, the gasoline will be conserved. But once the battery's charge is low, gasoline engines kick in so the car can continue to operate, but as a regular hybrid. EVs are solely battery-operated and have only an electric motor. There is no fuel tank or engine in the vehicle. Which is better to go with a hybrid and EV There isn't any right or wrong answer to deciding between hybrid and electric. You should instead take into consideration a variety of elements, including where you live, how much you currently spend for gas and how dedicated to reducing your carbon footprint and many more. "If you're not looking to map out the miles you'll drive or you're concerned that you suffer from range anxiety or you don't have any charging points, the plug-in hybrid could be a better choice for you," says Ronald Montoya, senior consumer advice editor at Edmunds. Begin by considering a specific hybrid model. You could share some details on your driving habits and the power configuration at home to determine your annual electric and fuel costs and how often you visit your local gas station. "If you are OK with making your route plans by mileage and have a charger at work or at home," Montoya says, "you're the ideal candidate for an electric vehicle that is completely electric." To find out the location of charging stations in the area, begin with the . Hybrids have advantages and disadvantages as you analyze the numbers in the calculator for plug-in hybrids we'll go over the main pros and cons that hybrids have to offer. Benefits Think about these when looking at hybrid cars: You won't be worried about running out of power. Because hybrid vehicles still allow you to use gas and diesel, you'll get covered by over 145,000 gasoline stations across the country. You'll spend less money each month. Although every car comes with distinct prices, hybrid vehicles tend to have lower monthly payments than all-electric vehicles, which will help keep your costs for transportation under control. But there are a few drawbacks to consider: You're still going to pay for fuel. Hybrid cars don't have a long range for operating on electricity, which makes gasoline the main power source for long road trips. For example, the Environmental Protection Agency sets the Toyota RAV4 Hybrid's electric-only range to 42 miles. There's a range available, but only for certain qualifying vehicles (hybrids must plug in and be new in order in order to qualify). You're still going to emit plenty of carbon. "The plug-in hybrid is able to reduce your fuel consumption," Montoya says, "but it's not completely." If you're determined to do the right thing to reduce your carbon footprint, then you should know that a hybrid car's fuel usage will contribute to the pollution of the earth. Electric cars have their advantages and drawbacks Even ideal candidates have to consider the advantages and disadvantages of . There are many advantages that you will get when you purchase an electric car It will save you on the high cost of gas. In January. 9, 2023, the average cost for a gallon of regular fuel will be $3.28, . With an all-electric vehicle, you don't need to worry about rising prices for fuel. If new fully electric vehicles are eligible to be eligible for . You'll make a positive impact on the planet. As governments and companies attempt to determine how to combat the effects of climate change, people can take action as well. "If your goal is to completely quit fossil fuels, then you'll need an EV," Montoya says. There are some disadvantages to electric vehicles. Unfortunately, they also have some negatives. For instance, you may have to locate a place to charge your car. If your battery is low and you're looking for a place to charge it isn't quite as simple as finding a gas station. "You'll find that both shores in the U.S. have the most charge outlets," Montoya says. "It's the moment you enter the states in the north-central region like Montana, North Dakota and Wyoming where they become more scattered." However, the future of electric cars looks bright with many more charging stations and plans by Federal government officials to bring down costs. There could be for a long time for each charge to complete. While fast public charging stations are becoming more common but basic charging stations can require a lengthy time to deliver the juice needed to travel. For example, 120V charging stations only grant up to two miles of driving per one hour that they charge. This is fine if you are charging overnight but not practical if you need a quick fill-up. . The cost of new cars is always high however, electric vehicles typically have higher sticker prices and monthly payments than the gas-powered car you're used to driving. You could pay more, too. A study conducted by Self, a financial technology firm Self found that the cost of insurance for electric vehicles are generally more than gasoline cars. In the end, whether you purchase a hybrid or an electric car, you'll need enough money to purchase the latest model of vehicle. Because prices are rising increasing, it's more crucial to slow down and consider what suits your lifestyle the best. You may not want to waste too much time but. Auto throughout 2023 is due to the Fed rate hike that will occur in the latter part of 2022. Therefore, you should begin by looking at electric and hybrid vehicles to figure out which is most suitable for you. It's equally important to shop around for lenders and today check to see if it's possible to lock in a competitive price on financing your new car.

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Written by a contributing writer

David McMillin is a contributing writer for Bankrate and covers topics like credit cards, mortgages, banking, taxes and travel. David's aim is to help readers understand how to save more and stress less.

Editor: Rhys Subitch Edited by Auto loans editor

Rhys has been writing and editing for Bankrate since the end of 2021. They are passionate about helping readers gain confidence to take control of their finances with concise, well-researched and well-written information that breaks down complicated topics into bite-sized pieces.

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(image: https://www.cashone.com/blog/Uploads/same-day-payday-loan.jpg)How to Pay Off Credit Card Debt in 4 Steps

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How to Get Out of Credit Card Debt in 4 Steps

Based on the amount, you can explore a DIY method like debt snowball or consolidation, or even look into debt relief.

by Sean Pyles Senior Writer | Personal financial and credit, and personal finance Sean Pyles leads podcasting at NerdWallet as the host and producer of NerdWallet's "Smart Money" podcast. The show "Smart Money," Sean talks with Nerds from NerdWallet's NerdWallet Content team to answer the questions of listeners about their personal finances. With a focus on shrewd and practical money tips, Sean provides real-world guidance to help people improve the financial situation of their lives. Beyond answering listeners' money concerns on "Smart Money," Sean also interviews guests outside of NerdWallet and creates special segments to explore topics like the racial inequality gap as well as how to get started investing, and the history of student loans.

Before Sean took over podcasting at NerdWallet, he covered topics that dealt with consumer debt. His writing has been featured on USA Today, The New York Times as well as other publications. When Sean isn't writing about personal finances, Sean can be found working in the garden, taking walks, or taking his dog for long walks. He is based within Ocean Shores, Washington.

and Tiffany Curtis Lead Writer | Health and wellness Tiffany Lashai Curtis is a chief writer for the financial team of NerdWallet. Her previous position was as the health writer at Livestrong.com and freelance writer for publications like Refinery29, Business Insider and MTV News, where she focused on issues that affect marginalized communities. Being a facilitator of wellness she's led health-related discussions with organizations such as Planned Parenthood and Harvard University. She is located in Philadelphia.

Updated January 25, 2023 9:36AM PST

Editor: Kathy Hinson Lead Assigning Editor Personal finance, credit scoring, managing money and debt Kathy Hinson leads the Core Personal Finance team at NerdWallet. Previously, she spent 18 years working at The Oregonian in Portland in roles including copy desk chief and team director of design and editing. Previous experience included copy and news editing for many Southern California newspapers, including the Los Angeles Times. She graduated with a bachelor's in mass communications and journalism in The University of Iowa.

The majority or all of the products we feature are from our partners who compensate us. This impacts the types of products we feature and the location and manner in which the product is featured on the page. However, this does not influence our evaluations. Our views are entirely ours. Here is a list of and .

If you're trying to figure out how to cut down on your credit card debt, know that you have plenty of options. Credit card balances grew by 15% in 2021 which is the highest increase in over 20 years in the report released in November 2022 by the Federal Reserve Bank of New York. [0] The Federal Reserve Bank of NY's Center for Microeconomic Data . . Accessed November 15, 2022.

In September 2022, there was a median amount revolving credit card debt owed by a U.S. household with credit card debt was $7,486 according to .

Successfully requires a hands-on approach starting with deciding on the best method of payment to contacting your creditors to discuss rates. Learn how to reduce your credit card debt in just four steps.

1. Find a payment strategy or two

If you really want to get rid of your credit card debt, consider these suggestions to get to your goal faster. Having a concrete repayment goal and strategy will help keep you and you and your debt from credit cardsin check.

Pay more than the minimum

Credit card issuers pay you a percentage, typically 2percent on the amount you have. Be aware that banks earn money from what they pay in interest every billing cycle, so the longer it takes to pay, the more money they make. The amount of credit card interest that is being paid has been increasing due to Federal Reserve rate hikes and increasing amounts of revolving credit card debt. It is estimated the U.S. households that carry credit card debt will pay an average of $1,380 in credit card interest this year, according to the study.

Look on your credit card bill for an "Minimum Payment Warning," which will have a table showing how long it would take to pay off your balance if you only made minimum payments -- and the amount of interest you'd be paying.

Debt snowball

The process of paying off your debt uses your sense of accomplishment as motivation. You prioritize your debts by amount, and then concentrate on wiping out the one with the lowest amount first. Once you've paid that amount, you then roll it into the amount that you're making towards the next one, and the next one, and so on. As a snowball rolls down the hill, you'll eventually make larger and bigger payments and eventually pay off your debt.

Debt avalanche

Like the snowball approach it starts by listing your debts. Instead in paying the card that has the lowest balance first, you then pay off the credit card that has the highest interest rate. This is a quicker and more affordable approach than the snowball technique.

Automate

Automating your payments is an easy way to make sure your debts are being paid so you avoid racking more late fees. If you're using the debt snowball or avalanche approach, however, you will have to be more involved to ensure you're contributing exactly what you want in each account.

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2. Consider debt consolidation

If your credit is good but your debt payments feel too much, think about putting them into one account. This way, you only need to pay one installment each month to reduce the balance.

A 0% balance transfer credit card

It may seem odd to apply for credit cards when your primary goal is to get out of credit card debt however, it can save cash in the end. Choose a credit card that has an extended 0% introductory period -- usually between 15 and 18 monthsyou can transfer all of your outstanding credit card debt to the one account. You'll have one simple monthly payment and you'll not have to pay interest.

Personal loans

Similar to that, you can also borrow a fixed rate loan to settle your debt. Although you'll have to pay interest, interest rates for personal loans tend to be less than credit card interest rates but they will allow you to save money. Use a to estimate your savings.

3. Work with your creditors

Reach out to your creditors to discuss your circumstances. A credit card issuer may be willing to negotiate terms for payment or provide a credit, particularly in the case of a loyal customer with a track record of payments.

If your issuer offers a hardship plan that can help you when circumstances beyond your control, such as illnesses or unemployment impact your ability to pay. And even if you aren't suffering from illness or unemployment the effects of inflation are causing financial hardship for many people. Based on the NerdWallet survey, 45% of employed Americans say their pay hasn't grown enough over the last year to keep up with the rate of inflation.

Whether you bargain with your lender or accept the terms of a hardship program or a hardship program, either could result in more affordable rates of interest or waived charges, subject to the issuer.

These small changes might suffice to get you the debt under control, and the worst that can happen is they refuse to accept.

4. Find help for debt relief

If the total amount you owe is more than you can pay every month and you're trying to bring the debt in check, then it might be time to take some more serious steps. Think about, for instance, the debt management program.

Debt management plan

These are developed with the assistance of the help of . Counselors negotiate terms with your creditors and reduce your debt on credit cards. Then, you'll pay the counseling firm a fixed rate each month. Your credit accounts may be closed, and you may have to forgo new ones for a time.

Bankruptcy

Filing for wipes wipes out unsecured debt such as credit cards, however, not without consequences. can help you restructure your debts to a payment plan over 3 to 5 years and could be the best option if have assets you want to keep. It can stay in your credit file for 7 to 10 years, however your credit score will be more likely to bounce back during the months following declaring bankruptcy. Some debts, such as and tax debts, generally can't be erased in bankruptcy.

Debt settlement

Under debt settlement, a creditor will accept less than what you are owed. While it sounds like a great deal, it's not an option for most people. Most often, you contract a debt settlement firm to deal for you with creditors. Read more details on and the dangers you are exposed to.

The authors' bios: Sean Pyles is the executive producer and host of NerdWallet's Smart Money podcast. His writing has been featured in The New York Times, USA Today and elsewhere.

Tiffany Lashai Curtis is a senior writer on the personal finance team. She has more than 5 years of experience writing about topics that affect communities that are marginalized.

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Freedom Debt Relief Review 2023

Advertiser disclosure You're our first priority. Each time. We believe everyone should be able to make financial decisions without hesitation. And while our site does not feature every business or financial product on the market We're pleased that the advice we provide, the information we provide as well as the tools we design are independent, objective simple, and cost-free. So how do we make money? Our partners pay us. This can influence the products we review and write about (and where those products appear on the site) However, it in no way affects our suggestions or recommendations, which are grounded in thousands of hours of study. Our partners cannot promise us favorable review of their services or products. .

Freedom Debt Relief Review 2023

By The Nerdwallet contributors are experts in their field, who come from various backgrounds including finance, journalism, and consulting. We adhere to the most stringent standards of editorial to ensure that our readers have the knowledge necessary to make financial decisions with confidence. Find out more about our

Updated Dec 20, 2022 12:05PM PST

Edited by Kathy Hinson Lead Assigning Editor Personal finance, credit scoring, debt and money management Kathy Hinson leads the Core Personal Finance team at NerdWallet. In the past, she worked for 18 years at The Oregonian in Portland in positions such as copy desk chief and team editor and designer. Previous experience included news and copy editing at many Southern California newspapers, including the Los Angeles Times. She graduated with a bachelor's in mass communications and journalism in Iowa's University of Iowa.

A majority of the items featured on this page are provided by our partners who pay us. This impacts the types of products we feature and where and how the product is featured on a page. However, this doesn't influence our opinions. Our views are our own. Here's a list of and .

Freedom Debt Relief, a service provider for debt settlement that negotiates with creditors to lower the amount of unsecure debt you are obligated to.

It's one of the many solutions to help with debt that consumers can avail. You'll want to consider whether you're eligible for another option to pay off debt and then evaluate the costs. Also, consider the possibility that Chapter 7 bankruptcy might wipe out more of your debts, and more quickly.

The following article sums it up:

What is Freedom Debt Relief? Freedom Debt Relief Works

How do you qualify?

Freedom assists customers who have debt from credit cards, medical bills and personal loans and students' private loans and other types of unsecured debt. Generally, you must have a minimum debt balance of $7,500 to be eligible, however some states have laws setting higher requirements for minimums.

As with other debt relief firms, Freedom cannot help clients with debt that involves collateral, like an auto or mortgage loan. Freedom also is unable to address student debts resulting from federal loans.

A typical customer will have around $23,000 of unsecured debt across eight to nine credit accounts once they have enrolled with Freedom as per Sean Fox, the company's co-president. The amount of debt that is unsecured can be up to $100,000 or more, with some customers with more than 20 credit accounts, Fox adds.

The debt settlement process

You can go online or contact them for an analysis of your debts as well as your eligibility for the program with an Freedom representative. You'll then have a program briefing that explains the program for settlement and you'll be provided with agreements and documents to take a signature. That's followed by an onboarding phone call.

Once you enroll debts in this program, it is necessary to are no longer paying for the accounts you have enrolled. Instead, you establish an account that is specifically designed to store payments for creditors. You'll control and own the account and deposit monthly installments into it. Freedom works with you to determine the amount to be deposited each month into the account. The amount is based on your capacity to pay and the amount of total debt enrolled, as per the company.

If you do not pay to a creditor, it becomes delinquent on that account. You accrue late fees and interest charges as well as your score is likely to decline. Delinquent accounts stay on your credit reports over a period of seven years.

When money is accruing in the designated account, Freedom begins negotiating with the individual creditors on your behalf to get them to accept less than the amount you have to pay. The concept is that after several months of insufficient payment the creditor will be inclined to accept the lower sum rather than risk getting nothing at all.

If a lender accepts the lesser payoff amount and you agree to pay the creditor, either a lump sum or in installments, from your dedicated account. You also then pay a fee for Freedom Debt Relief for its service.

Cost

According to laws, Freedom cannot charge upfront charges; instead, it collects an amount every time the settlement is reached with a creditor and you have approved the settlement and made at least one payment on it.

The fee ranges from 15% to 25%. It's based on the amount of the debt that is enrolled. It may vary depending on state regulations. If a customer pays off a credit card with a balance at $3,000, for example, would pay between $1,250 and $750 to Freedom for its service.

There's also a one-time cost of $9.95 to set up the account with a special purpose, and a monthly fee of $9.95 which covers account maintenance, Fox says. These fees are charged by the company hosting that account rather than by Freedom.

Time frame

Freedom states that the majority of customers get their first settlement in three months, but it may take longer based on the amount you pay each month, the number of accounts enrolled in the program, and the amount owed on each account. Freedom states that customers who are committed to timely monthly payments into their dedicated accounts pay off all indebtedness within 2 to 4 years typically.

From top to bottom

Freedom Debt Relief at a glance

Return to the top

What to learn about Freedom Debt Relief

Responsive to customer complaints

Freedom has an A+ rating on the time of writing . It has received over 350 complaints from customers in the past three years, including complaints about issues with its services and issues with billing and collection. Notably, the company has a 100% resolution rate for customer complaints via the BBB.

Lawsuit

In 2017, the firm was brought before the Consumer Financial Protection Bureau, that claimed the company billed people without settling their debts in the manner it was promised, forced them to make their own settlements and misled consumers about the fees.

In July of 2019, Freedom settled the CFPB lawsuit by signing a settlement agreement to make a payment of $20 million in compensation to the affected consumers as well as an additional $5 million civil penalty (0) Consumer Financial Protection Bureau . . Accessed November 12 20th, 2020.

.

From top to bottom

Risks of debt settlement

The potential risks and drawbacks with debt settlement include:

It's bad for your credit

If you're forced to stop making payments on outstanding debts in order to be enrolled into the debt settlement program, those accounts will show as delinquent in your credit report. Your credit scores are likely to suffer a major hit and could affect future applications for credit and even job. Delinquent accounts can be held over a period of seven years and so do loans that charge off accounts.

Success isn't guaranteed

Some creditors may transfer your debts to a third party collection agency or debt buyer. Freedom states that it negotiates with the third-party and can also coach clients to negotiate directly with creditors. However, results will vary.

Interest and fees accumulate

Over the period in which you're in the debt settlement program there will be additional fees for late payments and interest in your loan. If you don't remain in the program for long enough to finish the program, or in the event that Freedom does not negotiate an agreement, you'll be left with the debt that is higher.

You might still hear from debt collectors

Because you cease paying your account, you may experience aggressive collection efforts or lawsuits from your creditors. Freedom claims it will encourage clients to tell creditors they are working with the settlement firm and to send messages to Freedom via their personal online dashboard.

Forgiven debt may be taxed

Since the IRS treats forgiven debt as taxable income It's possible that you'll have to pay taxes on the debt you didn't have to pay off after you've settled. Certain creditors will mail an Annulment of Debt form . One exception is if you're insolvent (have more debt than assets) at the time you pay off debts to your creditors.

Speaking with an attorney or tax professional for more advice is advised.

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Freedom Debt Relief vs. other alternatives

Before settling on a debt settlement option consider other options, such as debt payoff , and other alternatives:

Debt management plan

This may be a better option for someone who has an income that is steady enough to pay off credit card debts within three to five years. You'll pay a non-profit credit counseling service to combine your debts into one payment per month at a reduced interest rate. However, you won't be able to access to credit cards or the ability to utilize credit cards during the payoff period.

Debt consolidation

If you opt for this option, you'll transfer multiple debts into one new debt, usually via using a balance transfer credit card, or . The new debt will have an interest rate lower than your previous debts and could allow you to pay off debts faster. However, it usually requires an excellent or good credit score to be able to get good terms.

Bankruptcy

The bankruptcy process can help you pay off your debt under protection from the federal court. will typically erase most non-secured debts in 3 to 6 months. However, not all people qualify. If you're in delinquency on your debt, declaring bankruptcy will put off solicitations from debt collectors as well as lawsuits filed against the debtor. Your credit may be affected, like debt settlement however, research has shown that credit scores are likely to improve within a year.

DIY debt settlement

You can pick up the telephone and call your creditors, then bargain with them directly. As with the use of a debt settlement firm the odds of success aren't 100 however it can make a difference in time and money.

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Why are Credit Card Interest Rates so high?

Advertiser disclosure You're our first priority. Everytime. We believe that every person should be able make financial decisions without hesitation. And while our site doesn't include every business or financial product that is available in the marketplace We're pleased that the guidance we offer as well as the advice we offer and the tools we develop are impartial, independent, straightforward -- and cost-free. So how do we make money? Our partners compensate us. This may influence which products we write about (and where those products appear on the site) however it in no way affects our recommendations or advice, which are grounded in hundreds of hours of study. Our partners cannot pay us to guarantee favorable review of their services or products. .

Why are the Credit Card Interest Rates So High?

Card issuers are in business to make profits however, it is a matter of the risk of financial loss they are taking.

The article was written by Gregory Karp Senior Writer | Credit cards, personal finance the credit score Gregory Karp is a former NerdWallet writer , and an expert in personal financial and credit card. As a journalist for over 30 years, he's been a newspaper reporter as well as an editor. He has written two books on personal finance and created the "Spending Smart" syndicated newspaper column. His honors include national recognition several times by The Society for Advancing Business Editing and Writing.

Updated Nov 9th, 2022 at 1:12PM PST

Editor: Kenley Young Assigning Editor Credit scores, credit cards Kenley Young oversees the daily coverage of credit cards for NerdWallet. Before that, he was a homepage editor and digital content producer at Fox Sports, and before that a front page editor for Yahoo. He has years of experience in digital and print media, including periods as an editor at the copy desk as well as a wire editor as well as a metro editor for McClatchy. McClatchy Newspaper chain.

Many or all of the items featured on this page come from our partners who pay us. This influences which products we feature as well as the place and way the product appears on a page. However, it does not influence our opinions. Our opinions are entirely our own. Here's a list and .

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Credit card interest rates might appear outrageous, and some go over a percentage rate, which is much higher than auto loans.

The reason for the seemingly excessive rates isn't just about greed or profit for the corporation The reason is that it's about risk for the lender. If you don't pay on your car or mortgage loan, the bank can take your house or car. If you do not pay your credit card bill, the card issuer's options are very limited. A card issuer could ruin your credit score and suffer the cost and inconvenience of suing you. However, there's no guarantee they'll be able to recover its funds.

In finance, generally the more risk you take the higher the chance of paying off you're hoping for. For banks and other card issuers, credit cards are decidedly risky because lots of people pay late or don't pay at all. Therefore, issuers have to charge high interest rates to compensate for that risk.

A balance that is not paid off is an example of a loan

For consumers, high credit card interest rates are irrelevant if they don't have a balance, or use cash advances. But if they have a monthly balance that they revolve be sure to understand that this is an actual loan. Like any other lender, the lender hopes to earn interest.

What is the reason rates are so high?

Unsecured loan: Credit cards are usually unsecured, meaning there's no collateral -- no asset that the lender will be able to take if the borrower fails to pay. It's different from the aforementioned , which requires an upfront deposit as collateral or loan for a home or vehicle, which is something a lender can repossess and resell to receive a portion of the money back. This is why banks don't give you the title to your vehicle for instance, until you finish paying your auto loan. And unsecured credit card balances aren't backed by anyone other than the promise of payment or pay, for example, the federal government backing some student loans.

Nerdy Tip

The default of a credit card, also also referred to as charge-offs, are when a bank gives up trying to collect the debt. Charge-offs were found to be in the range of 3% to 4% range from 2012 until 2019, but spiked past 10% in 2009 and 2010 following recession, according to data provided by the Federal Reserve Bank.

Uncertainty: Unlike other kinds of loans credit card companies don't inquire about why you require the cash. It can be used to pay for medical bills or car repair or to play blackjack at a casino or purchase bobblehead dolls. The banks aren't able to tell you how much you'll be borrowing. It could be zero or even your maximum credit limit. This uncertainty poses an opportunity for the lender.

Profit: The majority of card issuers exist to make money for shareholders or, in the case of credit unions, channel profits into benefits for their members. Credit card interest revenue helps increase bottom line profits and helps pay for the lucrative benefits of and 0% time periods of .

Are rates really that high?

It depends on the comparison. Rates are higher when compared to automobile loans as well as mortgages. are used to seeing in the single digits for those who have good credit. But credit card rates aren't as high when compared to rates that can be well over 100% APR.

In the first half of the year, the median interest rate for credit cards was around 17%, among accounts assessed interest in accordance with the Federal Reserve. The NerdWallet study found that rates have risen 35% in the last five years.

Why rates vary

Credit rating In essence, consumer credit ratings are supposed to show the probability that you'll be able to repay any loan which includes a debt on your credit card. The people with higher credit scores for instance, those with better credit scores, pay lower rates as their probability of default is less. This is the reason why interest rates on credit cards are expressed as a range, to reflect rates charged to consumers with good, average, and bad credit.

If banks believe in you more and believe that their risk is less and they offer you a lower interest rate.

You can get your from NerdWallet.

Market conditions the credit card market is competitive, so finance charge rates are mostly similar among major issuers. Additionally, they tend to change in sync with current rates of interest, which are often linked to a benchmark known as the prime rate. The rates charged by cards are typically the prime rate plus some fixed number of percentage points. When the rate of prime is 5 percent and your card is charging 10 percentage points in addition to the prime rate, your APR is 15%.

>> MORE:

How can you avoid high rates

Pay off the balance: If you don't have any monthly bills and you're not a cardholder, you do not have to worry about what rate your card issuer charges.

>> MORE:

Lower your rate It is possible to use a variety of strategies to , including negotiating a lower rate, using credit cards that allow balance transfers or, in the long term, . Credit unions are a great spot to find credit cards with low-interest interest rates.

The author's bio: Greg Karp is a former NerdWallet writer, and an expert in personal finance and credit cards. He worked previously at The Chicago Tribune and wrote two money books.

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Written by Rebecca Betterton Written by Auto Loans Reporter

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If you've been browsing through the channels recently, you've likely been met with ads advertising Memorial Day sales at car dealerships. While Memorial Day weekend is known for the hefty discounts on cars however this year's sales will take some extra consideration. The average price for used vehicles is about $28,000, while the typical price for a brand-new car is even higher at around $47,000 . However, this price, due in part to this, doesn't mean the deal isn't within the realm of possibility. Just be prepared to make some preparations ahead of time. The Memorial Day sales will be very limited. Historically, Memorial Day has been one of the most ideal times to get a good automobile deal. But this year will likely cause drivers to have less luck when it comes to making a purchase. Limited vehicle stock The industry isn't able to catch up with the consumer demand. Dealers are selling cars in a lightning-fast pace due to the low number of available vehicles. A 1.5 million drop in the supply of vehicles for March in comparison to 2021. As factories halted production, the shortage of semiconductor chips led to the loss of vehicles at the dealer. This led to a period of greater demand and a shortage supply. If you are shopping this Memorial Day weekend, you will likely still be met with fewer vehicles. Less incentives With fewer cars available, dealers are likely not under pressure to sell their vehicles like they did in the ago. With the number of drivers in desperate need of automobiles, they're less driven to offer incentives such as incentives or money back. In previous years, this holiday weekend was full of different incentive options, but dealers won't need incentives to sell cars in 2022. J.D. Power reports that the incentives per unit are anticipated to reach $1,044 -which is down from $3,334 one year ago. A lower supply of vehicles also means more drivers vying for the same car. This will result in obtaining the dream car more difficult. A lot of buyers are willing to spend over the asking price to buy the car they want before another driver will. This significantly alters the playing field and gives dealers the advantage in the pricing. The typical price of a used vehicle is selling for around 28 percent higher than this time last year. In addition, with the finding that 42 % of consumers are willing to pay over the price of the vehicle, you're likely to encounter a fair amount of competition. How can you get the best bargain despite the limitations want to leave with a brand new vehicle following the coming Memorial Day weekend, there are a few tips you can follow to get the best deal -- even if there are fewer cars on the lot. Test drive before the weekend The best way to reduce time and ensure you're at the dealership before the deadline is to test drive before the scheduled the scheduled time. You can then walk in ready to buy rather than feeling under pressure to buy for a car that you're not fully convinced about. For a test drive, research vehicles online and then call your dealer to arrange an appointment prior to. Explore other ZIP codes While the epidemic caused vehicle supply challenges but it also accelerated the shift . Use this latest opportunity to determine whether there are cars available in areas outside of yours. It's a similar process to that of an in-person purchase and you could save extra cash along the way. In addition, some locations offer better prices, it might be worthwhile to travel to a to find your next vehicle. Be flexible with your vehicle selection With fewer cars lining dealership lots, now could be a great time to expand your horizon regarding the car's model, size and design. The majority of drivers are at a certain brand or model, and so flexibility could mean getting an automobile that others do not. Consider checking out for the most reliable cars in your search. Next steps Purchasing a vehicle is a major financial investment. After considering the changes that will be made to this year's holiday weekend, determine if it's worth the money and effort. If you are not actually making money buying something during this Memorial Day weekend, and you can afford to wait, being patient may be a better option. Take a break from the huge holiday shopping rush and instead wait for more vehicle inventory to become accessible. You may be met with shorter lines, more options and potentially lower prices.

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Written by Auto Loans Reporter

Rebecca Betterton is the auto loans reporter for Bankrate. She specializes in assisting readers in navigating the ways and pitfalls of taking out loans to purchase an automobile.

The edit was done by Rhys Subitch Edited by Auto loans editor

Rhys has been editing and writing for Bankrate since the end of 2021. They are dedicated to helping readers gain confidence to take control of their finances through providing concise, well-studied facts that break down complicated topics into bite-sized pieces.

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(image: https://i.pinimg.com/originals/df/de/59/dfde599a06710fcf37ecc61290e85dca.jpg)5 Tactics to Pay Off Purchase Now and Pay Later Debt

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5 Strategies to Pay Off Debt the Debt Buy Today, Pay Later Debt

If you're planning to buy something now, when your pay later bills are due, think about these strategies when you are figuring out how to get from debt.

Written by Melissa Lambarena Lead Writer | Credit cards, the debt Melissa Lambarena is a lead writer on the credit cards team at NerdWallet. She has been a passionate writer covering the subject of credit cards for over six years. Her previous experiences include nine years as an editor for various websites and magazines. Through her work, she aims to help users extract benefits from credit cards in order to help them achieve financial goals such as increasing their budgets, establishing credit and traveling to their dream destinations and paying off debt. She explores these issues as well as others in the Millennial Money column featured in The Associated Press. Her writing has also been featured on The New York Times, Chicago Tribune, The Washington Post, USA Today and Yahoo Finance, among others. Melissa holds a bachelor's degree of sociology, earned from the University of California, Los Angeles.

Updated January 13th, 2023 at 7:46 AM PST.

Editor: Kenley Young, the Assigning Editor Credit cards, credit scores Kenley Young directs daily coverage of credit cards for NerdWallet. Prior to that, he worked as an editor of the homepage and digital content producer for Fox Sports, and before being a front-page editor at Yahoo. He has a wealth of experience in both digital and print media. This includes times as a copy desk chief, a wire editor and a metro editor for the McClatchy Newspaper chain.

Many or all of the items featured on this page are from our partners, who pay us. This influences which products we feature and the location and manner in which the product is featured on the page. However, this doesn't affect our opinions. Our opinions are our own. Here's a list of and .

A LOT LIKE THIS

You can bet the " " bill from the holiday season will arrive in the near future or already arrived.

If you're not financially ready to pay up, late fees or other charges can bury you deeper in debt. The situation can alter in a matter of weeks through economic setbacks such as unemployment, unexpected bills, a family emergency or other events.

If it's time to take on the pinch of those pay-in-four buy now, pay later plans -- and possibly other debts -- it's crucial to devise plans to pay down the balance.

Here are a few options to think about as you plan your strategy to pay off debt.

1. Update your budget

Reevaluate your habits and reduce unnecessary costs or switch services to cheaper alternatives. Cancel unused subscriptions such as, for instance switching to a streaming service that is less expensive.

If you're also struggling with debt from credit cards which could take between three and five years of repayment to clear, think about consulting an accredited nonprofit credit counseling agency to consolidate some balances into one low-interest installment. It is important to note that accounts that are enrolled in the plan are typically required to be closed, which could impact your financial situation in the short-term.

2. Change your payment due date

Some lenders like Klarna and Afterpay permit you to alter the payment due date and request an extension.

Klarna customers who take advantage of a pay-in-four loan can extend the due date for the payment for each purchase once by 14 days, per the company's website. Afterpay might offer more flexibility and allow changes to the date for payment as often as six times per year in the application, according to Amanda Pires, a company spokesperson.

Policies of lenders can differ and you should read the plan's conditions or speak to the lender regarding your options.

3. Talk to lenders about the need for assistance

If a financial setback or crisis prevents you from making your payments, the buy now, pay later lender could provide some relief.

Major purchase today, pay later businesses with hardship policies typically recommend that you contact customer service as soon as possible regarding difficulties.

"Affirm people who are facing financial difficulties can reach us via our help center so we can help them determine a repayment plan that best meets their personal requirements," Casey Becker, a company spokesperson, said via email.

The terms of the loan vary according to lender.

4. Think about a balance transfer credit card

If you're in good standing with your credit (a FICO score of 690 or higher) Some issuers may offer you the opportunity to pay buy now, to pay off debt later. It could allow you to extend your time should you be trying to meet the schedule's deadlines for payments however there are a few important things to consider.

Balance credit cards for transfer are designed to help you reduce interest costs for an agreed-upon time period however, they may not be suitable for certain buy today or pay later plans which don't charge interest at all. Additionally, you can transfer a balance only as high as the card's credit limit permits and usually there's charges based for the amount that you transfer typically between 3% and 5%. Compare potential buy now, pay later costs against these variables.

The process and terms will differ among the card issuers which allow this, so be sure to ask what to expect. Wells Fargo, for instance will allow you to use an account balance transfer to pay buy now, pay later debt.

"The most popular practice is to transfer balances of another credit card issuer to the Wells Fargo account to save on interest costs," Sarah DuBois, a Wells Fargo spokesperson, said via email. "If there's an issuer that isn't technically a retailer (or bank) card issuer customers have other options to avail the balance transfer offer (i.e. by using a balance transfer credit that is generally issued in conjunction with an deal)."

If a credit card company offers a balance transfer option in the form of an actual check, your capacity to make use of it could be contingent on your lender's capability to accept the payment method.

5. Consider the pros and cons of the personal loan

A personal loan can consolidate multiple debts into a monthly fixed payment at a lower rate of interest over a predetermined period. If the funds are sent into the account of your bank account, it's generally possible to make use of them to pay lenders, including buy-now, payday lenders. A high credit score could be able to qualify you for lower interest rates.

It's also not a good idea to repay debt using credit, therefore it's essential to calculate whether the proposed interest rate is a savings with any potential charges on buy now, pay later plans. If the buy now, pay later plans don't cost any fees or interest, then making it possible to pay it off with an individual loan might not be the best option. But it might be worthwhile to use the loan to consolidate other debts -- if that can free up money to pay off buy-now, pay later plans.

The article was written by NerdWallet and was originally released through The Associated Press.

About the author: Melissa Lambarena is a credit cards writer at NerdWallet. She has had her work featured in The Associated Press, New York Times, Washington Post and USA Today.

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