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Chapter 13 bankruptcy can address unseen credit card debt

Avoiding credit card debt might seem like a good idea, but doing so can actually be fairly difficult. From credit card offers in the mail, during checkout at popular retail stores and even in emails from an individual's banks, these rectangles of plastic seem to be everywhere. Unfortunately, credit card debt is also fairly common, which Chapter 13 bankruptcy can help address. However, just like how some California consumers might not even realize how many credit card offers they receive on a daily basis, others may not even know they have debt on their cards.

It is hard to miss the growing concern over the student loan debt crisis since outstanding balances recently hit an astounding $1.4 trillion. Credit card debt also recently topped out at $1 trillion, making it another significant point of financial stress for consumers. While most people with student loan debt are fully aware of it, a recent study found that 21% of people do not even know if they have a balance on their credit cards. That same survey found that 30% of consumers know they have credit card debt, but do not know how much they pay for interest every month.

While no two consumers are alike, the survey did identify a few key issues for consumers. It found that 24% of people who have credit card debt currently owe over $10,001. Of those with debt, 37% carry their balance on a single credit card while 12% carry their balances across at least five different cards. Consumers who have debt on multiple cards might find that doing a balance transfer from their cards with the highest rates to those with the lowest rates might make paying off the debt easier.

However, for some consumers, debt management techniques such as balance transfers are not enough to help them address their debts. In these situations, Chapter 13 bankruptcy could be an appropriate choice. When a person in California files for Chapter 13, he or she will usually be able to discharge remaining debts after completing a repayment plan that lasts anywhere from three to five years.

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