The rise of credit cards has undoubtedly made our lives easier in many ways. With just a swipe or tap, we can purchase goods and services without carrying around cash. However, there’s always the risk of falling into credit card debt.

In fact, according to a recent study, the average American household carries over $6,000 in credit card debt.

In this article, we will discuss the dangers of credit cards that many people ignore. We will also discuss how a credit card debt defense attorney can assist in managing this type of debt.

The Temptation to Overspend

One of their significant risks is the desire to overspend when using credit cards. When credit is easily accessible, making snap decisions without considering the repercussions can be tempting. This can quickly lead to high debt levels, especially with high interest rates.

In fact, studies have found that people typically spend more money when using credit cards instead of cash. This is because consumers can more easily overlook the true cost of their purchases since credit cards provide a psychological barrier between them and their money.

High Interest Rates

Many people often overlook the high interest rates associated with credit card debt. Even though the original purchase might seem inexpensive, paying off the balance might become challenging due to the rapid accumulation of interest. This is especially dangerous for individuals who only make minimum monthly payments, as they pay much more in interest over time.

A WalletHub survey indicates that the average credit card annual percentage rate (APR) just shot up to 20.92%, the highest level since the Federal Reserve started tracking APRs in 1994.

Impacts on Credit Score

Missed or late payments can significantly reduce your credit score, making it more tricky for you to obtain credit or loans. More so, having high credit card debt can negatively affect your credit score. This is because credit utilization, the amount of available credit being used, accounts for 30% of your overall credit score.

The higher your utilization, the lower your score will be. It may also be more difficult to pay off current debt due to higher interest rates associated with low credit scores for new loans or credit cards.

Hidden fees

Credit card companies often have hidden fees that can add up quickly. These include annual fees, balance transfer fees, foreign transaction fees, and more. Many people know about these additional costs once they receive their monthly statement.

Credit card companies can also increase interest rates, change payment due dates, and add new terms without prior notice. This can make managing debt and keeping up with monthly payments challenging.

How a Debt Defense Attorney Can Help

Consulting a credit card debt defense lawyer could be helpful if you're having trouble paying off credit card debt. These attorneys specialize in helping individuals manage their credit card debt and protect their rights as consumers.

They can bargain with credit card companies on your behalf to get fees waived, interest rates lowered, and a repayment schedule tailored to your budget created. They can also assist in stopping collection calls and harassment from creditors.

Furthermore, if you believe the credit card company has violated your consumer rights, a credit card attorney can help you take legal action.

Final Thoughts

Credit cards are convenient and have advantages, but there are risks involved that should be considered. Unexpected costs, exorbitant interest rates, effects on credit ratings, and overspending are a few things that might seriously harm your financial situation.

Getting the assistance of a credit card defense lawyer can be quite beneficial if you are having trouble managing and paying off credit card debt. To escape the credit card debt trap, always use them sensibly and be aware of your rights as a consumer.