TAMPA, Fla. — A Florida family has been fighting for years to try to get out of a hole that high-interest credit cards left for them after medical bills decimated their savings.
The Nunez family debt hit $100,000, Andrea Nunez told ABC Action News. Andrea and her husband both work. They tried cutting corners, even going without a second car for several months after it broke down.
“We had to say no to a lot of things," Andrea said. "And we ate a lot of beans.”
But their sacrifices barely made a dent due to credit card rates that were as high as 27%. Andrea said she made minimum payments of $2900 on a $38,000 balance, but nearly a third of her payment went to the interest.
The couple turned to the nonprofit Money Management Internationalfor help. The debt counseling agency reports an increased number of consumers, like Nunez, struggling with credit card debt.
The group contacted the credit card companies and negotiated to lower the interest rates on Nunez's cards, and the family said it has made a huge difference.
“I am now seeing the money come off with the credit cards," she said. "I'm paying the same amount I was but now that now the balance is going down."
If you're struggling with credit card debt, you may not need professional help to get the interest rates lowered. A Lending Tree survey found that three-fourths of those who asked for a better interest rate were successful in getting it. On average, banks lowered their rates by 6 percent.
Another option is to transfer your balance to a card with a lower rate, but only if you can pay it off during the promotional period. And, although these cards may charge three to five percent of the amount in balance transfer fees, this can be far less than the total monthly interest you'd be paying on the high-rate card.
For Andrea, the lowered rates put her family on track for debt freedom in three years versus the three decades it would have taken them to get their balances to zero. She also said they've given up using credit cards for good.
