How Do I Lower My Debt Burdens?
March 10, 2010
How do I lower my debts?
There are several ways of improving your credit status. If you have decided upon taking up firm steps to decrease your debts, then you may consider these few ways for dealing with the situation.
1. Debt Relief:
Try to negotiate with your creditor to come to an agreement by which a part or the whole debt will be forgiven. This will be a mutual agreement between the creditor and the debtor, where the debtor requests the lender to waive off at least a portion of the debt owed to him. Debt relief has been variously named as debt reduction, debt workout, debt settlement, debt negotiation or debt management.
This is however, a risky process, as you may not be able to handle the situation well. In that case, the complete endeavor may not only go in vain, but also go against your cause.
2. Take a Home Equity Loan:
If you have assets such as your own house, you may consider taking a home equity loan or a home equity line of credit. Such a loan generally has lesser interest rates. However, if you are unable to pay-off your home equity loan, you may risk losing your home altogether.
Is Independence Overrated?
March 2, 2010
Happy Independence Day from The Money Motivator!
If you don’t celebrate “The 4th of July” like we do in the United States, today still presents you with an awesome opportunity to examine your independence.
Independence means the quality or state of being dependent. The word dependent means not subject to control by others, according to Merriam-Webster Online Dictionary.
A full 95% of the world will NEVER know what it feels like to have true independence. True independence involves being free from debt, which is a form of control. I have seen debt destroy far too many relationships, including mine. It was not until I decided to stop the cycle of debt that I was able to begin to enjoy life.
Today can mark your first step in gaining true independence. You must complete one simple action. The first step is simple, yet it can be so powerful that it can set off a firestorm of ideas to end your finance problems.
What is the first step? It is simply to DECIDE to eliminate debt wherever possible. For now do not concern yourself with how this will happen, just make the decision and in due time you will find the solutions.
Fast Track Out of Debt
February 22, 2010
You go to the mail box and scan - a couple fliers (nah), your magazine subscription (yes!) and bills (groan). Every month the bills show up and as you sigh and take out your check book you wonder if you will ever be free.
Each month you pay the minimums and although you KNOW you’ve got a handle on it - you are not charging your credit card or accumulating new debts anymore - it seems that you will be paying the minimum fees forever.
Did you know that HOW you pay your debts can affect how soon you will finishing paying them off - even if you keep paying the same amount for debt every month? Of course you might be able to get a consolidation loan, but if you’re not eligible or are not interested then there are several other things you can do.
It’s not always the easiest to figure out the mathematics, but there are three steps to quicker debt relief - guaranteed.
STEP ONE - Create a list.
List your smallest debts first followed by your largest high-interest debts (credit card) and then your largest low-interest debts (Lines of credit and taxes).
Debt Handling Solutions
February 13, 2010
Sometimes debt can seem overwhelming. In those instances, or even before things get that far out of hand, get back to basics and try some of these debt handling solutions.
BASICS ? Lower insurance deductibles for your homeowners, renters and vehicles policies where appropriate and save money. Don’t take chances on bouncing checks; instead get covered with overdraft protection and pay about the same as what it would cost for one bounced check to cover our account for an entire year. Ask your banker about packaged account services. Many offer free savings and checking accounts with free overdraft protection and checks, free online bill paying and more. When you shop, check your receipts, even for groceries. Many times items ring up at incorrect prices. Sometimes store policy allows for no errors, meaning you get the items free if it wrings up wrong. So carry along a handheld calculator or pencil with small notepad to tally up your charges.
Credit Card Debt: How to Get Rid of It
February 5, 2010
This method is simple, but requires some discipline.
First, you have to stop any new spending on your cards.
Second - you’ll need to examine all of your spending. You’ll need to know how much extra money you’ll be able to put towards paying off your cards.
Credit card companies generally determine the minimum payment to be 2 - 2.5% of the outstanding balance. So if you owe $1,000, for example, your minimum payment will be 20 - $25 per month.
Some part of that $25 goes to the interest on the balance, some to pay off the actual balance. How much goes where depends on the interest rate. Your credit card statement will give you the exact numbers.
Let’s say that $20 of the $25 goes to the actual balance. To pay off $1,000 at $20 per month will take 50 months. Just over four years. You’ll also have paid $250 in interest alone.
Here’s how you pay them off:
Look at the interest rates on all your credit cards. Take the one with the highest rate. That’s the one you’re going to work on first and we’ll call it card #1.
The Road to Debt Relief
January 28, 2010
Living with debt is not something someone hopes for, but it happens and it usually becomes far more severe than it should before something is done to eliminate it. Once many individuals realize they have a problem with debt, they are too embarrassed to ask for help so they let themselves dive further into debt. Being embarrassment and ashamed are regular emotions many encounter when they realize they are in debt however you are not alone so you shouldn’t feel embarrassed.
Everyday people get into debt, but everyday people are looking for ways to debt relief, whether it is through self-help, credit counseling, dept management programs, or other resources. If you are struggling with debt you no longer have to feel ashamed or embarrassed because there are resources that will steer you in the right direction towards eliminating your debt. There are a variety of options one can choose from so you have the option of choosing what debt relief option is right for you.
First you have to consider how serious your debt is. Remember having debt isn’t good period, but you have the possibility of different solutions depending on the type of debt you are in. You have to decide what you think the best solution is for you and stick with it, to make sure you eliminate your debt, and stay out of debt for good.
Corporate Debt Management ? Perspective on the Why
January 20, 2010
Entrepreneurs have a tough time in their formative years. They try too many things to get a foothold on this competitive business climate, and that too they try them too soon. When they enter into new fields that have great promise and bet on new products they run the risk of costly failures. New product launches are costly and sometimes may take time to click. Risk is one factor which keeps the Businesses spinning new concepts and makes money out of it. It is this risk that keeps the uninitiated away. If you can’t risk and make some bets in business then it is no field for you. But sometimes folks go a little far on investing more and more in a failure with hopes that one day they may click. It is the greatest for a selected few to know when to invest further and get out soon sometime. But for the rest of us it is mostly trial and error. This is where debt shows its gory true form.
Credit Repair? Its All Up to You
January 13, 2010
Log onto to a search engine such as google.com and type in the term credit repair. It’s likely that Google will return more than 25 pages of listings, many of which will be companies claiming they can "erase bad credit," "create a new credit identity ? legally," " credit problems ? no problem." "quick credit repair," and on and on.
Here’s the good and bad news of credit repair, according to the U.S. Government ? nobody but you can repair your credit.
If you do respond to one of these credit repair offers, here’s what to look for to know it’s probably a scam:
· The company wants you to pay for credit repair services before they provide any services.
· The company does not tell you what your legal rights are and what you can do for yourself.
· The company recommends that you do not contact a credit reporting company directly.
· The company suggests you create a new credit "identity" and then a new credit report by applying for an Employer Identification Card to use instead of your Social Security number.
Debt and Financial Optimism in the UK Continue
January 4, 2010
With £1.3 trillion pounds worth of debt in the UK, Scotland’s Citizens Advice Bureau has welcomed a new Bill to regulate lenders and protect borrowers from creating un-repayable levels of personal debt.
Chief executive Kaliani Lyle said: “For years, Citizens Advice Bureaux have been dealing with case after case of ordinary people who have been enticed into unsustainable debt."
“The existing legislation - the 1974 Consumer Credit Act - is simply too antiquated to deal with the explosion in aggressively marketed credit that has taken place over the past decade or so."
The Consumer Credit Act is set up to outlaw "extortionate" interest rates, however it has proved to be ineffective as it doesn’t actually define what is regarded as extortionate.
This coincides with an investigation being carried out by banking watchdogs, into suspected mis-selling of personal loans and credit cards at bank branch levels. Following on from the BBC’s Real Story programme which revealed banks are offering large staff bonuses to encourage sales of expensive loans, credit cards and other financial products. Staff at Lloyds TSB were shown to have encouraged customers to accept sums of money they could not afford to repay.
How to Avoid Bankruptcy
December 27, 2009
Bankruptcy is a legal way to offer folks with high interest debt a fresh financial start in life. In case you are considering personal bankruptcy as an answer to your debt problems, you are not alone. Bankruptcy is on the up and up as consumer debt explodes. Additional reasons for turning to bankruptcy for credit card debt alleviation include medical costs and job loss.
The two main types of bankruptcy are Chapter 7 and Chapter 13. Chapter thirteen is generally preferable for most people as it allows the defaulter to hold at least some property. It is imperative to understand that a bankruptcy does not remove all your debts overnight. Alimony, income taxes, child financial support and student loans are not exempt from bankruptcy proceedings.
Many people think that filing bankruptcy is an easy way to solve all their debt and credit related problems. Filing bankruptcy is the worst thing you can do as far as your credit is concerned and it is best to learn how to avoid bankruptcy. A bankruptcy will remain on your credit report for 5 to 10 years. The new bankruptcy laws require that individuals contemplating bankruptcy take a financial counseling course which is a positive thing. Many find that bankruptcy is not actually the best option for them. Make sure you have all the facts and consider all the alternatives before making a decision that can have far reaching effects.
