Credit card debt can be crippling since most credit cards have an interest rate<\/a> of 20% or more. That\u2019s significantly higher than other kinds of debt<\/a>, such as mortgages or auto loans.<\/p>\n\n\n\n To put it simply, if you\u2019re always carrying a balance on your credit card<\/a>, it may be challenging to balance your budget since you\u2019re constantly making card payments.<\/p>\n\n\n\n Even though your credit card statement<\/a> says you only need to pay the minimum payment<\/a>, you should always strive to pay the total balance. Anything less and you\u2019ll incur interest charges. Obviously, you want to avoid those since no one wants to pay more than they have to.<\/p>\n\n\n\n Having credit card debt can also negatively affect your credit score<\/a>. For example, let\u2019s say you regularly carry a balance of $3,000 and you have a total limit of $5,000. That means your credit utilization ratio<\/a> is 60%, which is quite high. How much credit you\u2019re accessing relative to what you have available is one factor the credit bureaus use to determine your credit score<\/a>. If you\u2019re always carrying a balance, you may not appear as creditworthy.<\/p>\n\n\n\n It\u2019s also in your best interest to avoid credit card debt if you plan on buying a home in the future. When determining how much they should lend you, lenders typically look at your total debt service (TDS) ratio<\/a>. Your TDS ratio includes all your housing costs, plus any outstanding debt. So if you\u2019re carrying a lot of credit card debt, it will directly affect how big of a mortgage you can afford<\/a>.<\/p>\n\n\n \n\t\t\t\t\t\tCompare all different credit cards side-by-side and find out the best card that will meet your need with special perks and benefits\t\t\t\t\t<\/p>\n\t\t\t\t\n\t\t\t\t Credit card debt can affect your family in a variety of ways that you may not be aware of.<\/p>\n\n\n\n Let\u2019s say you\u2019ve ignored your bills and your credit card provider has sold off your debt to a collection agency. Many collection agencies can be highly aggressive and call your home or even work to get you to pay. While your debt doesn\u2019t directly involve your family, collections may be hostile towards them in an attempt to get you to pay.<\/p>\n\n\n\n \u00bb MORE:<\/strong> How to deal with debt collectors<\/a><\/p>\n\n\n\n There\u2019s a scenario where your debt could directly affect your family. Let\u2019s say you\u2019re a joint credit cardholder<\/a>. If you rack up a bunch of credit card debt, the primary cardholder would be responsible for paying off the balance. This also applies to co-applicant credit cards. If you had a family member co-sign for you when you applied for your card, they\u2019d be equally responsible for any outstanding debt.<\/p>\n\n\n\n If the credit card debt is solely in your name, only you are responsible for paying it. Even if you were to pass away, your family would not be personally liable for your debt. However, a credit card company can make a claim against your estate<\/a> for payment of your debt.<\/p>\n\n\n\n Admittedly, clearing your credit debt is not always easy, but there are a few things you can do to help get on track.<\/p>\n\n\n\n Many low-interest credit cards<\/a> have an option that typically comes with an attractive interest rate so you can transfer your credit card balance<\/a>. For example, you might pay 3.99% interest for nine months. After that promotional period ends, you\u2019d still pay a lower interest rate than you would with typical credit cards.<\/p>\n\n\n \n\t\t\t\t\tTransfer high interest debt<\/strong> to the MBNA balance transfer credit card!\u00a0<\/strong> You could apply for a line of credit<\/a> at your bank since the interest rates are pretty reasonable. If approved, you\u2019d take that money and immediately pay off your credit card debt. You would then only need to worry about paying off your line of credit.<\/p>\n\n\n\n If your debt is out of control and you can\u2019t manage it anymore, you should speak to a licensed insolvency trustee<\/a>. They can look at your situation and determine if a consumer proposal or declaring bankruptcy is a viable option.<\/p>\n\n\n\n Getting control of your credit card debt is not always easy and you may need some help. However, once you acknowledge that you have a problem<\/a>, you can take steps to get back in the green.<\/p>\n\n\n\n Barry Choi is a freelance personal finance and travel expert. His website moneywehave.com is one of Canada's most trusted sites when it comes to all things related to money and…<\/p>\n\t\t\t\t\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\tRead more about Barry Choi and explore their articles<\/span>\n\t\t\t\t\t\t<\/a>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t<\/div>\n\t\t\t<\/div>\n<\/div>\n\n\n\n\t Bankruptcy is a legal tool to help consumers resolve overwhelming debt. It\u2019s a major decision, so make sure you know the consequences and alternatives.<\/p>\n\t<\/div>\n\n\t If you are in overwhelming debt, a consumer proposal might be able to help you consolidate and repay your debts without giving up your assets. <\/p>\n\t<\/div>\n\n\tHow to avoid credit card debt<\/h2>\n\n\n\n
Best Credit Cards in Canada<\/h4>\n\t\t\t\t\t\t\t\t\t
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\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t<\/div>\n<\/div>\n\n\n\nIs my family responsible for my debt?<\/h2>\n\n\n\n
How to pay off debt<\/h2>\n\n\n\n
Apply for a low-interest credit card<\/h3>\n\n\n\n
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\t\t\t\t<\/div>\n\t\t\t<\/div>\n\t\t\n\t\tMBNA True Line\u00ae Mastercard\u00ae<\/h6>\n\t\t\t\t\t\t\t
Welcome offer: You could get a 0% promotional annual interest rate (\u201cAIR\u201d)\u2020 for 12 months<\/strong> on balance transfers with a 3% transfer fee! No annual fee. Standard interest rate is 17.99%. Terms and Conditions Apply.
\t\t\t\t<\/p>\n\t\t\t\t\t<\/div>\n\n\t\tGet a consolidation loan<\/h3>\n\n\n\n
Talk to a licensed insolvency trustee<\/h3>\n\n\n\n
\n\t\t\tAbout the Author\t\t<\/h4>\n\n\t\t\t\t\t
\n\t\t\t\tDIVE EVEN DEEPER\t\t\t<\/h4>\n\t\t\n\t\t
![\"What](\"https:\/\/www.nerdwallet.com\/ca\/wp-content\/uploads\/sites\/2\/2021\/07\/What-is-Bankruptcy-e1627600206748-460x191.jpg\")
\t<\/a>\n\t\t\t\n\t\n\t\tWhat Happens When You File Bankruptcy in Canada?\t<\/a>\n<\/h4>\n\n\t
![\"\"](\"https:\/\/www.nerdwallet.com\/ca\/wp-content\/uploads\/sites\/2\/2021\/07\/Aaron-Broverman-e1626212778927-40x40.jpg\")
Aaron Broverman<\/a>\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t<\/div>\n\t\t<\/div>\n\t<\/div>\n<\/div>\n<\/div>![\"Is](\"https:\/\/www.nerdwallet.com\/ca\/wp-content\/uploads\/sites\/2\/2021\/08\/Is-a-Consumer-Proposal-Worth-It--e1628205525696-460x191.jpg\")
\t<\/a>\n\t\t\t\n\t\n\t\tIs a Consumer Proposal Worth It?\t<\/a>\n<\/h4>\n\n\t
![\"What](\"https:\/\/www.nerdwallet.com\/ca\/wp-content\/uploads\/sites\/2\/2021\/06\/GettyImages-1220141287-e1624919262174-460x191.jpg\")
\t<\/a>\n\t\t\t![\"\"](\"https:\/\/www.nerdwallet.com\/ca\/wp-content\/uploads\/sites\/2\/2021\/07\/Sandra-MacGregor-e1626212852416-40x40.jpg\")
Sandra MacGregor<\/a>\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t<\/div>\n\t\t<\/div>\n\t<\/div>\n<\/div>\n<\/div>\t\t<\/div>\n\t<\/section>\n\n","protected":false},"excerpt":{"rendered":"