As we have observed here at the Small Business Development Center, far too many small businesses have gotten themselves in trouble with credit cards. Many clients had come in with that issue even before the economy dropped off. With lines of credit unavailable due to banks tightening their policies, credit cards were a tempting alternative. We’ve seen clients with as many as ten cards maxed, which contributed to their eventual bankruptcy. Banks have been more than agressive in raising interest rates if a payment is a late (or for various other reasons) making it even harder to carry the debt load.
Two articles are posted today on this topic. The first is a posting via PRNewswire on a study that confirms this dangerous trend, and a follow on article by Pamela Yip of the Dallas Morning News, that describes how to negotiate with credit card companies.
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