Can you use a gift card to pay down debt? -

Got debt? Use a gift card!

It's no secret - times are tough and many people are struggling to make ends meet. Now some are turning to an unlikely source to pay off bills -- gift cards.

It's an easy gift to give. But if you get one, don't be so quick to head to the mall to spend it - especially if you have unpaid bills.

Consumer Reports' Money Adviser magazine says some companies like cell-phone companies and certain retailers will let you use bank issued gift cards (ones that bear a major credit card logo like Visa, MasterCard or American Express) to pay off your balances.

The key is asking your creditors if they will accept what's called a split-tender transaction. That means combining more than one form of payment -- say, your gift card, plus a check or credit card.

Remember, this should only be tried with bank-issued gift cards that carry either a Visa, MasterCard or American Express logo.

Also, don't expect to be able to pay off your entire bill with the gift card alone.  Companies will still want some other form of cash or credit card.  

And bank-issued gift cards have expiration dates and the longer you wait, the less likely you can use that gift card to pay off your bills.

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