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Why being a hardcore credit revolver will always hurt you ultimately

Credit cards can be a blessing or a nightmare depending on their use. The wise credit card holder, pays off the credit card debt at the end of each month. These types of people are few and far between. Most people pay only the minimum payment as set by the credit card company. Lately however some credit card companies have taken to listing the number of years it will take to pay off the entire debt, if only the minimum payment is made each month. It can be staggering to see that it might take a person twenty-five years plus to pay off one credit card.

How about those Americans? A recent study showed that one in ten Americans actually has ten credit cards in their wallet. It is highly unlikely that they are being paid off each month. In fact for some people it is a good bet that they are using one credit card to pay the monthly payment on another. This layering of debt, will continue to grow like a nightmare.

One of the big disadvantages of being a credit revolver is spending money that you don’t actually have. It becomes so much of a convenience to just reach into the wallet and pull out a credit card. Not all credit cards have the same amount of credit available, so when a credit revolver uses up the $5,000 on one credit card, instead of paying that card off, they may just make the minimum payments. In the meantime, they will search out another fresh credit card and usually look with one for a higher credit available.

The big problem with credit cards is the fine print. While you might have one maxed out at $5,000, your credit card company may be able to adjust the credit limit or the interest whenever they want to. Frequently credit card companies will see that you are maxed out or close to it and then send you a sneaky letter. In the letter they will congratulate you on managing your credit well and then tell you that they are going to reward you by adjusting the amount you can borrow. A hardcore credit revolver will get very excited to see that now instead of having only $5,000 that they can borrow, its been adjusted to $7,000. In most cases they will start looking immediately for something they feel they need to purchase right away.

Credit cards are not the only type of credit that gets abused by consumers. Banks frequently issue lines of credit to homeowners, with the idea that they can use the money to invest in repairs or upgrades to make the value of the house higher. Unfortunately credit revolvers see this as an opportunity to spend the cash in their wallets, because they have a back up plan in the credit line. So when the mortgage time comes around, the credit revolver will either pay the mortgage with a credit line check or deposit the check just shortly before the mortgage due date. Credit revolvers frequently ended up filing for bankruptcy or debt consolidation assistance because they cannot manage the credit offered to them.