The average consumer carries around $20,000 worth of credit card debt and pays close $400 a month on that credit card debt. The average interest rate on credit cards in the United States is 15% APR. So if you take the time to figure out the statistics you will find that over the life of your credit card debt you will end up paying back the credit card company $70,003.50 for the $20,000 you borrowed. It would also take you 175 months or 14.58 years to completely payoff your credit card debt.
If you choose to enter into a Debt Settlement program with $20,000 on average your total amount of debt would be reduced to $11,600 including the debt settlement company’s fees.
You would end up saving a total of $50,003.50 in interest and a total of $8,400 in your principal balance. Making your grand total savings of $58,403.50! If you continue paying $400 per month in a debt settlement program you will be completely debt free in 33.14 months. Under 3 years!!
Interest rates
Interest rates vary widely. Some credit card loans are secured by real estate, and can be as low as 6 to 12% in the U.S. (2005). Typical credit cards have interest rates between 7 and 36% in the U.S., depending largely upon the bank's risk evaluation methods and the borrower's credit history. Brazil has much higher interest rates, about 50% over that of most developing countries, which average about 200% (Economist,
May 2006). A Brazilian bank-issued Visa or Mastercard to a new account holder can have annual interest as high as 240% even though inflation seems under control at around 6% per annum (Economist, May 2006). Banco do Brasil offered its new checking account holders Visa and Mastercard credit accounts for 192% annual interest, with somewhat lower interest rates reserved for people with dependable income and assets (July 2005).[citation needed] These high-interest accounts typically offer very low credit limits (USD$40 to $400). They also often offer a grace period with no interest until the due date, which makes them more popular for use as liquidity accounts, which means that the majority of consumers use them only for convenience to make purchases within the monthly budget, and then (usually) pay them off in full each month.
If you choose to enter into a Debt Settlement program with $20,000 on average your total amount of debt would be reduced to $11,600 including the debt settlement company’s fees.
You would end up saving a total of $50,003.50 in interest and a total of $8,400 in your principal balance. Making your grand total savings of $58,403.50! If you continue paying $400 per month in a debt settlement program you will be completely debt free in 33.14 months. Under 3 years!!
Interest rates
Interest rates vary widely. Some credit card loans are secured by real estate, and can be as low as 6 to 12% in the U.S. (2005). Typical credit cards have interest rates between 7 and 36% in the U.S., depending largely upon the bank's risk evaluation methods and the borrower's credit history. Brazil has much higher interest rates, about 50% over that of most developing countries, which average about 200% (Economist,
May 2006). A Brazilian bank-issued Visa or Mastercard to a new account holder can have annual interest as high as 240% even though inflation seems under control at around 6% per annum (Economist, May 2006). Banco do Brasil offered its new checking account holders Visa and Mastercard credit accounts for 192% annual interest, with somewhat lower interest rates reserved for people with dependable income and assets (July 2005).[citation needed] These high-interest accounts typically offer very low credit limits (USD$40 to $400). They also often offer a grace period with no interest until the due date, which makes them more popular for use as liquidity accounts, which means that the majority of consumers use them only for convenience to make purchases within the monthly budget, and then (usually) pay them off in full each month.
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