Is your credit card debt getting out of control? This is a serious sign of trouble ahead and acting as quickly as possible to stop the spiral of additional debt and interest is the only way to save yourself financially.

Even if you feel overwhelmed because your static income is unlikely to pay off your debt, there are many ways to manage your debt or at least reduce its costs. All you need to do is to have a better understand of your options and select the one the works best for you.

And you can do it all yourself with a little research and conversation with your bank. If it gets complicated, a professional might be your only resort.

Here are some options that you can inquire about.

Refinancing your debt

Banks often are willing to work with you to find ways that help you pay off your debt. Ask about refinancing your credit card debt, which will mean turning your credit card debt into a longer-term repayment period and probably a lower rate.

By doing so, you will be able to repay your debt without incurring any additional interest or penalty fees. If the bank is unwilling to do so, it may offer you a personal loan instead to pay of your debt. In essence, you will be able to achieve the same goal: You will pay off your credit card debt and pay a lower rate on the loan amount that on credit card.

Once you reach such a solution, it is important that you don’t accumulate new debt on your credit card because it will be even more difficult to pay off.

Tapping into your home equity

If you own a home, you may be able to get a line of credit or a home-equity loan against the equity that you have in the home. Because these lending options are secured with your home, they are likely to have a much lower rate than credit cards and personal loans.

Having said that, it is a risky practice, because you will be simply using the equity you built in your home. This equity is what you’d use to get a new home or cash out when you eventually sell the house.

If that solution gets you out of credit card trouble once, make sure you don’t end up in the same position again. Using home equity is typically recommended for investments in the house rather than for covering expenses. Again, this can be a last-resort option if you’re in a bind.

Take a new credit card

This might sound counter-intuitive if you’re already struggling with credit card debt, but in fact some credit cards can help you transfer your debt and you don’t have to pay interest on the balance transferred for quite some time.

This option works for someone who is just struggling with cash flow, and needs a few months to pay off debt.

Remember that is not the case with all cards, so you must inquire ahead of time that you will be able to transfer your balance without fees and you will not have to pay interest. Compare different balance-transfer cards to find the one with the longest period.

Get an advocate

If your debt is complex and you’re unsure you will be able to handle it yourself, get an advocate. This person could be a financial adviser or a specialist in debt-settlement. Either can put you on the right path and help you either negotiate with your lender or even negotiate on your behalf.

Hiring a financial professional when you’re running low on cash may sound like a luxury, but it could save you a lot over time. Remember credit card debt is very expensive, and interest every month will incur more interest and penalty. So act quickly to evade trouble.


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