4 simple ways to get help with credit card debt over $10,000
Credit card debt has quietly crept into the five-figure range for millions of Americans recently, which is hardly surprising given today's inflationary environment and other economic challenges, which are driving more people to use this type of shorter-term borrowing to get by. As a result, the total amount of credit card debt nationwide has now reached a record $1.21 trillion. Average credit card interest rates are also hovering near 22% on average, making it tough for cardholders to stay on top of payments as their balances snowball.
Having $10,000 or more in credit card debt can be more than just a monthly budget issue, though. While it can be tough to make the monthly payments on a balance that high, the reality is that it can also affect your credit score, limit your ability to borrow for other goals and create persistent financial stress. The good news is that whether your debt is $10,000, $15,000, or even higher, you have more tools at your disposal than you might realize. Many people just simply don't know where to start, which can make the problem feel even bigger than it is.
The longer you wait, however, the fewer options you may have. So what are the simple, practical ways to get help with credit card debt over $10,000? Below, we'll detail four that borrowers should know now.
Find out more about the credit card debt help that's available to you.
4 simple ways to get help with credit card debt over $10,000
If your credit card balance has crossed the $10,000 threshold, you'll likely need to do more than make the minimum payments or slightly larger payments to make meaningful progress. Fortunately, the strategies outlined below can help you get out of debt faster and potentially save thousands of dollars in interest:
Work with a credit counseling agency
Many credit counseling agencies offer free or low-cost consultations to help you understand your debt and create a realistic repayment plan. During this process, a certified credit counselor will take an in-depth look at your finances, reviewing your income, expenses and debts, and may help you create a debt management plan that's tailored to your situation.
If you qualify for this type of structured repayment plan, the credit counseling agency will try to negotiate lower interest rates and fees with your creditors to make your payments more affordable. You then make one consolidated monthly payment to the agency, which distributes it to your card issuers based on the new terms.
For someone with $10,000 or more in credit card debt, a debt management plan can significantly reduce your interest burden and provide a clear payoff timeline, which is typically three to five years. And, this repayment strategy can actually help protect your credit score over time.
Learn how a debt relief expert could help you find the right solution now.
Utilize a debt consolidation loan
If you have decent credit, a debt consolidation loan can be another powerful tool to consider. With this option, you take out a fixed-rate loan — ideally with a lower interest rate than your credit cards — and then use it to pay off all of your card balances at once. That allows you to replace multiple high-rate cards with a single loan and a predictable monthly payment.
For example, if you qualify for a 12% fixed-rate personal loan to consolidate $10,000 in credit card debt, which currently has a 22% APR, you could save thousands of dollars in interest over the life of the loan and pay off the balance much faster. Just keep in mind that debt consolidation loan approval depends on factors like your credit score, income and debt-to-income ratio. If your credit is less than stellar, you may need to consider other relief options first.
Consider a 0% balance transfer card
If your credit is strong and you can realistically pay off your balance within 12 to 21 months, a 0% APR balance transfer credit card can give you the breathing room you need by removing interest from the equation. Many credit card issuers offer these types of promotional periods with no interest on transferred balances, which means every payment you make goes directly toward principal.
For a $10,000 credit card balance, this move can be a game-changer. However, this option isn't without caveats. You'll typically pay a 3% to 5% transfer fee in return, and once the promotional period ends, the APR typically jumps back to standard levels. So, this strategy works best if you have a solid repayment plan in place, one that allows you to pay off the full balance before the promotional term ends.
Try to settle your debts for less
For borrowers with significant credit card debt and limited ability to repay, debt settlement, which is also commonly referred to as credit card debt forgiveness, can offer a more aggressive form of relief. With this strategy, you or the debt relief expert you work with will try to negotiate directly with your creditors to reduce the amount you owe, often by 30% to 50% or more, in return for a lump-sum payment on the account.
Given the potential reductions to your balance, debt settlement may help you resolve your large debts faster and for less than you owe. However, it's important to note that it can also negatively impact your credit during the process, and there are fees involved if you're working with a debt relief company on it. It can also result in paying taxes on the forgiven debt.
The bottom line
Having more than $10,000 in credit card debt can feel isolating, but you have multiple avenues for support, from structured repayment plans to strategic consolidation to legal relief options. Whether you choose credit counseling, consolidation or settlement, the right help can make a seemingly unmanageable balance entirely conquerable. The most important thing, though, is to take action now rather than waiting. That first step is often the hardest, but it's also the most powerful.
