By Mike Stetzer
Many consumers make the mistake of confusing the minimum amount required and the total amount due on their credit card statements. Not understanding the difference can lead to financial difficulties and can damage a consumer's credit score.
According to Forbes, the total amount due is the total balance on that credit account. If a consumer pays it, he no longer owes anything on the card and no interest can accrue. The minimum amount required is the minimum payment a consumer must make every billing cycle to avoid being considered delinquent on his loan and eventually having the account go to collections.
Consumers sometimes think the total amount due is what they must pay, and avoid paying anything if they cannot afford to pay off their total balance. This is a financial mistake, according to the news source. Paying the minimum amount is better for a credit score than not paying anything.
Consumers who can no longer afford the minimum payments on their debts may want to seek out credit counseling or consult a bankruptcy attorney about their options.
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