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Deal With Your Debt

Most of us have debts, but some of us seem to let debts spiral out of control. Taking control of your debt problem and dealing it maturely is an empowering experience, and living a debt free life should be an aspiration. There can be all sorts of events which can trigger debt problems, such as rising interest rates, illness or redundancy. Regardless, you need to take responsibility for your situation and find a way out of it.

Some people choose to simply switch their debt to a new credit card, taking advantage of 0% interest on balance transfer offers. While this can be a good way of managing relatively small debts, you will often find the banks sneaking in extra charges which mean the new credit card becomes just another expense.

When debt gets out of hand, it’s no good burying your head in the sand and pretending it isn’t happening. When the collection calls and letters arrive from debt recovery companies, it should send a shiver down your spine. And that shiver should prompt you to sit down and calculate just what sort of mess you have got yourself into.

Work out all your debts, and record key pieces of information such as total debt, minimum payments and interest rates. Calculate how much you are paying on a monthly basis and this should help you to figure out how to correct it.

There are debt management companies out there who can consolidate all your debts into one monthly payment which is les than your current payments. The consolidation company negotiates with your creditors and ensures that they are paid a portion of your monthly payments to them. They negotiate smaller payments and reduced interest rates to ensure you can get on top of your debt.

Some people choose to take out loans, or even second mortgages or other types of home equity. This can be a good way out of a debt crisis for homeowners, and banks tend to offer low monthly payments over an extended period of time. Never forget that your home is your collateral and if you start missing payments your home is at risk.

If your debts are getting out of hand then act quickly before they get worse. Ignoring debt problems only leads to more debt problems, and at some point you need to take control. The sooner you start managing it the better, and the sooner you can be debt and care free.

John Mce writes on a number of subjects including credit card debt & living a debt free life