Don’t Skip Mortgage Payments to Pay Credit Card Debt

Consumers are changing the way they do business on a daily basis by prioritizing credit card payments over mortgage payments. Consumer debt rose in January 2010, but consumers continued to pay off their credit cards that month causing a record 16th straight month of lower credit card debt. A study by TransUnion (one of the three major credit reporting agencies) of 27 million anonymous consumer records pulled randomly from its database found the number of consumers delinquent on their mortgages but current on their credit cards rose to 6.6% in the third quarter of 2009 from 4.3% in the first quarter of 2008. The portion of those who fell behind on credit card payments but paid their mortgage dropped to 3.6% from 4.1%. This is an unprecedented shift for consumers. Paying one’s mortgage has always been a consumer’s top priority.

TransUnion reports first seeing this shift in payment precedence in the fourth quarter of 2007 by consumer’s with the lowest credit scores. Since the trend was first reported experts are seeing it creep into all income levels and those with a range of credit scores.

The reasons for paying credit card debt over the mortgage payment are varied but a few may be:

• Many homeowners owe more on their homes than they are now worth causing them to rethink continuing to pay on a home that is “underwater”.

• An unemployed homeowner may value the continued use of a credit card for food and necessities over holding onto a home which they cannot afford.

• A foreclosure in most states takes over a year whereby one missed payment can cause a credit card limit to be cut, interest rates to rise or a card to be canceled.

• Consumers dread the barrage of collection calls that come from delinquent credit card bills.

Many consumers simply do not know where to turn when there isn’t enough money to go around or do not know the options available to them. Another trend developing in this poor economy is debt negotiation whereby a consumer can settle unsecured debts such as credit card debt (not mortgages or car loans) for pennies on the dollar and eliminate the debt altogether, allowing them to focus on saving assets such as their home and vehicle.

These professional debt negotiation paralegals have a ten year history of haggling with creditors and debt collectors to eradicate late fees, interest, over limit fees and a good portion of the principal allowing a consumer to pay what they can afford to purge them of credit card debt one credit card at a time and breathe a sigh of relief.

www.CreditCardDebtNegotiator.com offers a completely free, no obligation consultation for anyone interested in learning about the option of debt negotiation. Debt negotiation is NOT the same as debt settlement. With debt negotiation the consumer retains complete control of what account is settled, how much it is settled for and when the settlement takes place. Debt negotiators charge a small, one time flat fee to negotiator for the consumer with a database and years of learning the insider secrets of debt collection. A debt negotiator never collects or holds money for the consumer or pays any bills on the consumer’s behalf.

Questions can be directed to Consult@CreditCardDebtNegotiator.com or by calling (614) 453-5963. Visit http://www.creditcarddebtnegotiator.com/ for more information.