In case you didn’t know, there is another bubble, growing massive in this country, about to burst. Revolving consumer credit card debt continues to grow each month, finally crossing the $900 billion mark for the first time last June. The Federal Reserve reports that this year, Americans racked up $39 billion in new credit card debt. We refer to the coming crisis as the credit card tsunami. You better blow down the hatches!

For the month of August 2007, US consumers added another $6.2 billion in new debt, on top of the $5.6 billion they accumulated in July. Overall, including everything except mortgages, Americans owe nearly $2.5 TRILLION DOLLARS in debt! Now that the mortgage game is over, and all that easy money has been made, the next big thing banks will milk for maximum growth and profits are cards. Fees and penalties have been rising steadily for years, as have average interest rates. Last year, banks earned more than $100 billion in interest and another $50 billion in fees and penalties; these guys are not your friends.

Many people, who are being squeezed by the bursting of the housing bubble, are increasingly relying on their credit cards to live. As the spigot of home equity money has dried up and their lifestyles aren’t changing, or circumstances like job loss or medical difficulties keep them dependent on credit cards, there’s no end in sight to the amount of additional debt that John Q has. The public will assume. At some point, the dam has to burst and a lot of people are going to fall in.

Who knows how many people have lived beyond their means over the last few years, extracting temporary wealth from their real estate, only to spend it on luxuries like vacations and lavish Tuscany weddings? How many people have transferred unsecured credit card debt to their real estate, only to risk foreclosure if they miss a few payments? What about people who thought the value of an already overpriced home would continue to rise and took out mortgages with tempting interest rates, hoping to refinance with the proceeds in a couple of years, and now they’re stuck with a mortgage which has been duplicated and no way? to pay it?

Now that the game is up, those people are turning to their credit cards to survive. People who were “hooked” on interest rate mortgages now find themselves unable to pay the “real” mortgage payment. Many are going into default on their mortgage and keeping up with credit cards. Some are using them like an ATM, pushing them to the limit, constantly requesting the barrage of new cards gracing their mailbox.

They’re living in fantasy land if they think late mortgage payments won’t hurt your credit. Give it a month or three, and when the credit cards see that you’re missing mortgage payments, they’ll raise your interest rates to over 25% and then, excuse my French, “fucked.” Most of your payment will be wasted in interest, and it could take anywhere from 10 to 100 years to pay off the debt.

The card companies know that people will do anything to keep up with the cards and that people need cash. Credit card requirements are the lowest in 10 years according to a Federal Reserve survey; if you have a pulse, you can get a credit card. They even give credit cards to people’s pets.

The junk mail credit card applications that litter your mailbox are brought to the post office in semi-trucks on skids and unloaded by forklift. While mailings are actually less than what was mailed at its peak in 2005, the percentage of people who responded and were accepted by credit card companies has risen steadily and, in fact, it has increased three times since 2005!

All of this is the result of the closing taking equity in your overpriced home. It was never sustainable, and I feel sorry for the people who bought at the peak, paying over $600,000 for a 40-year-old house that wasn’t worth a quarter of that price. To think that the bubble could continue to grow and that the median home price exceeded the average person’s ability to buy one, it was only a matter of time before something had to give, and it has.

Now, I talk to people all day who are taking credit card cash advances to live on or pay off their mortgages; that will end at some point.

The credit card bubble will be the next to burst. If your credit card debt is out of control, you need to do something. Through the debt settlement process, there are ways to settle with creditors for less than what you owe, within 3-4 years, leaving you in a position to get new credit after it ends. Read our free report on debt settlement to see if it’s an option for you.