The Best Credit Card Debt Repayment Options for Different Credit Scores

by Gary Foreman

Best Credit Repayment Options Based on Credit Scores photo

Your credit score often determines the options you have for paying down debt. Here are the best repayment options for your credit score.

Credit card debt can be crippling. So getting to a zero balance is important. We’re going to help you do that. So let’s get started!

There are two potential paths to reducing credit card balances. One is appropriate for people with good or excellent credit. The other is better suited for people with fair, poor or bad credit. What score qualifies as good?

  • Excellent Credit: 750+
  • Good Credit: 700-749
  • Fair Credit: 650-699
  • Poor Credit: 600-649
  • Bad Credit: below 600

Check your credit score

Don’t know your credit score? Check with your credit card issuers. Many offer free credit scores to cardholders. Or you can get your score from one of these trusted Dollar Stretcher resources:

If your credit score is over 700

If your credit score is over 700, you’ll want to look into these options for reducing your credit card balances:

Transfer your credit card balances to a lower rate card.

Your good credit allows you to look for balance transfer cards. Some of them will even charge you 0% interest for a time. You can compare balance transfer cards here.

Consolidate your credit card debt with to a personal loan.

You may also qualify for a lower cost personal loan. You can compare personal loan rates here.

Consolidate your credit card debt with a HELOC or Home Equity Loan.

If you are a homeowners, sometimes your best move is to move debt from a higher cost to a lower cost debt instrument, such as a Homeowner’s Line of Credit (HELOC) or Home Equity Loan. The loan costs less because you’re moving from an unsecured to a secured debt. In the HELOC or Home Equity loan, as you’d expect, the equity in your home guarantees the loan. Find out what rates are available.

If your credit score is under 700

If your credit score is under 700, you’ll want to look into these options for reducing your credit card balances:

Apply for credit counseling.

If your credit card balance is $10,000 or more, you may want to consider credit counseling. They’ll attempt to get your credit card companies to stop charging late fees and reduce your rate. Use these guidelines to find out if you are a good candidate for credit counseling.

Get professional advice.

Sometimes a problem is too complicated to just google an answer. If your debt is serious enough that your credit score is being affected you’re in one of those times. We advise readers to use the services of CuraDebt, a debt relief company. Debt relief companies will study your situation and then provide you with your best options. CuraDebt, one of the leaders in the space, has helped over 180,000 people to date and they are a trustworthy “Member In Good Standing” of the Online Business Bureau.

If you have other debts in addition to credit card debt

If you have other types of debt in addition to credit card debt, you likely need a debt payoff plan that addresses all of your debt. It can often save you more money than addressing debts individually. The TDS ebook How to Conquer Debt No Matter How Much You Have can help you.

We will walk you through the creation of your own personalized debt payoff plan tailored to your debt burden, budget and lifestyle. You can read more about it here.

Reviewed July 2020

About the Author

Gary Foreman is a former financial planner and purchasing manager who founded The Dollar Stretcher.com website and newsletters in 1996. He's the author of How to Conquer Debt No Matter How Much You Have and he's been featured in MSN Money, Yahoo Finance, Fox Business, The Nightly Business Report, US News Money, Credit.com and CreditCards.com. Gary shares his philosophy of money here. Gary is available for audio, video or print interviews. For more info see his media page.

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