Any interest owed on the amount of the loan is also included in the liquidated debt amount.
Prior to that determination, your legal obligations are unknown, and the debt is considered unliquidated.For example, a cardholder who owes ,956—the average amount of debt per household, according to Ben Woolsey, the director of marketing and consumer research for Credit Cards.com, a credit-card–comparison site—will end up shelling out an additional ,000 in total interest if she pays only the minimum each month.You may have had a very good reason for running up high-interest debt: Maybe you had to make some unexpected big-ticket purchases or lost a job or endured an illness. If you’re carrying balances on multiple cards, it’s a long slog to wipe out those debts.Additionally, any companies mentioned in the content do not assume responsibility to ensure that all posts and/or questions are answered.Minimum payment due, reads the box on your credit-card statement.Commercial papers are unsecured promissory notes that are issued by corporations.These notes have a fixed maturity that is usually less than a year in length.If your answer is “Having one card totally paid off,” then throw as much money as you can toward the card with the lowest balance first, says Curtis Arnold, the founder of Card Ratings.com, a credit-card–comparison site.(Yes, do this even if you need to pay only the minimum on your other cards in the meantime.) If your answer is “Boosting my credit score,” then tackle the card with the highest utilization rate (that’s your balance divided by the card’s limit).“Since your score takes a hit if you use more than 20 percent of your available balance, bringing the utilization rate down just 20 percent could significantly increase your score,” says Arnold. Often a simple phone call to the issuer is all it takes to get a reduced rate—provided that you have good credit (a score of 730 or higher) and you are a long-term customer who makes payments on time.And if your answer is “Paying less in interest,” then the tried-and-true method is to pay off the card that has the highest interest rate first. You could get a percentage point or two shaved off, which can add up to hundreds of dollars saved annually. It’s tempting to move a balance from a card with a high interest rate to a card with a substantially lower one (find one at Bankrate.com).