If you are in a bad financial situation, it can feel like any offer from a lender or creditor is just the opportunity you needed. Do not fall for this. If you are truly in over your head, then it might be time to talk to a bankruptcy attorney. Do not allow creditors or anyone else to take advantage of you: contact The Law Offices of Paul Y. Lee at 951-755-1000 for help.
Your Credit is Bad So You Have to Take a Terrible Deal
You might have bad credit, but that does not mean that you need to accept credit at 25% or 50% annual interest. Some companies might actually charge several hundred percent annual interest! Even a “low-interest” card could be a scam if it comes with huge fees for pre-payment, late payments, or monthly maintenance. Even if you have bad credit, there are lenders out there likely to give you a better deal than 50% APR. It is always worth shopping around.
Your Credit is Okay So You Can Get a Pre-Approved Credit Card
It is all too common for a credit card company to tell you one day that your credit is terrible and they can only offer you a very high interest rate, just to tell you the next day that you are “pre-approved” for a credit card, mortgage, or another loan. These companies even extend credit to people who are unemployed or in college. Do not be flattered by a pre-approved card – take it through the same steps you would take any other card through to determine if it is the right card for you.
Low Monthly Payments That Never Stop
If you are being asked to pay very low monthly payments, you should take a look at the fine print. It is likely that you are going to pay a lot more in the long-term. Consider that if you pay $100 every month for two years, you will pay $2400. If you pay $150 for 12 months, you will save $600. That is 25% just by paying $50 extra dollars per month.
Actual Costs Can Vary
If you see this, know that they can vary by cents, dollars, or even thousands of dollars. In short, if it seems too good to be true, then that is likely because it is. Concerning terms to look out for include:
- 0% interest to start
- Bounced check “protection”
- Buy now – pay later
If you see a low cost upfront and then extra “protection,” you should stop right there and ask the simple question: what will the total cost be? Your life after bankruptcy does not have to include wasting money on fees and high interest rates. Contact The Law Offices of Paul Y. Lee at 951-755-1000 if you have not yet started the bankruptcy process and we can walk you through it from start to finish.
