Five ways to pay off your credit card debt(Image: Getty)

A report from Standard Life says we're spending nearly £4,000 a year on our credit cards. And some of us are spending a lot of money paying back credit card debts.

Not so long ago, balance transfer credit cards seemed to offer money for nothing. As long as you could keep one credit card deal ahead of your debt, you would never have to pay back balances or even interest on your debt.

Millions of smart credit cards users were tempted by what turned into a 0% credit card trap - it seems people who once bragged about being debt-free just couldn't resist the lure of 'free' money and were transferring balances instead of paying them off.

And look how easily it all got out of control: no sooner had you got onto the 0% bandwagon than your 0% rate had come to an end, so you switched to another lender. A few credit card companies down the line and your credit limit had increased, along with your debt. But, you thought, it's free, so why not use it?

That was until you took the time to tot up the balances and found out that you were far more in debt than you'd ever imagined you could be. And then credit card companies made it a lot harder to switch balances.

If you are feeling trapped, don't panic. Here are five straightforward ways to tackle your out-of-control credit card debt.

1. Switch the balance to another 0% rate
It's true that credit card companies are clamping down on applications for new credit cards.

However, if you have an excellent credit rating you should still be able to get credit. And the even better news is that there are longer 0% balance transfer periods available than there were this time last year.

Barclaycard currently offers two Platinum cards, one offering 0% on balance transfers for 22 months and one for 20 months. Virgin Money's MasterCard, NatWest's Platinum MasterCard and the Royal Bank of Scotland's Platinum MasterCard also offer 20 months interest free. Meanwhile, Capital One's Transfer card offers 0% on transfers until 1 May 2013.

All of these cards charges balance transfer fees, so make sure you weigh those up when you're choosing a card to apply for.

And this time around make sure you do everything you can to start paying that debt off before the 0% period ends.

Compare 0% balance transfer credit cards

2. Consolidate your debts
Many of us have more than two credit cards in our pockets. This is a problem because keeping tabs on how much you owe and when payments are due is hard work with so many credit card accounts.

The big risk here is that if you miss even one payment you could end up finding the credit card company automatically switches you to its standard rate, leaving you with a balance that's racking up interest at an even more astonishing rate.

Not only that, but missing just one payment can hit your credit rating. Some credit card companies will view you as less credit-worthy, so you'll be reducing your chances of getting another 0% rate deal.

The first thing to do with any credit card is set up a direct debit to pay off at least the minimum each month. That way you know that's taken care of and you won't be penalised for taking your eye off the ball for a moment.

However, if you have more than three cards, it is also sensible to consider consolidating the balances onto one. This makes keeping tabs on exactly how much you owe, easier. And it can also make you wake up to exactly how much you owe.

3. Opt for a 'life of balance' card
It is all too easy to have worked your way through all the 0% rate deals and still find yourself with a hefty balance to clear. If this is the case, or if you know for a fact that there's no way you'll have cleared the balance by the time the 0% rate ends, then switch to a life of balance card.

These are cards that have a fixed rate of interest that's payable as long as the transferred debt is still outstanding. And you can take as long as you need. Because the credit card companies don't set a time limit on how long you can have that rate.

They are a blessing for 0% 'rate tarts' who've got a bit carried away and found themselves with bigger-than-expected balances.

What you have to remember is that you're still in debt, and you're still paying interest on that outstanding balance. And don't spend on these cards because you'll incur standard rate interest on purchases if you do - until the transferred balance is cleared. And, depending on how undisciplined you are, that could very well be years.

Compare lifetime balance credit cards

4. Re-apply or remortgage
If you find yourself in the scary position of being turned down time and again for credit cards, the first thing to do is check your credit file.

Look out for anything erroneous on there that could be stopping you from getting credit. Check that you're on the electoral roll too, because credit card lenders like to know who they're dealing with.

If everything seems to be in order and the rejections are simply a result of you having borrowed too much, then you have two options. One is to stick with the credit card companies you're already with for another 12 months, making sure you diligently make payments each month. This way you'll start to repair your credit rating. Then try applying for cards again.

The other option is to remortgage. Credit card companies may want to offer you credit, but because you're prepared to put your home up as collateral, your mortgage lender is more likely to give you the credit you need.

If you have no other option but to remortgage or accept your credit card company's standard rate, you'll be financially better off - in the short-term - if you do the former. While the standard credit card rate stands at around 19%, fixed-rate mortgages are generally less than 7%, so you'll save a lot on repayments.

However - and it is a big however - the problem with adding the debt to your mortgage is that it could take you as long as 25 years to clear, so you'll be paying interest on it all that time. This means, overall, you'll pay a lot more to borrow the money.

And one other thing you need to do is make sure that, should property prices fall, you won't end up with a mortgage that's worth more than the value of your home. If that happens you'll be in dreaded "negative equity" territory and the stress of paying off a few thousand pounds of credit card debt will be nothing compared to the risk of losing your home.

5. Re-think your spending
If your spending has spiralled out of control, this should really be a priority. You need to batten down the hatches and do everything you can to whittle that debt down to zero. Cut out that morning coffee, ditch your TV channel subscriptions, stop eating out so much and stop spending money on 'treats' such as new clothes that you don't really need. It sounds tough, but it's time to get tough.

Note: the information in this guide was correct at the time of publishing

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