Get Out of Debt

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If you’re suffering from credit card debt, then you should take action promptly to prevent the problem from escalating. Here are some specific actions you can take that can help you regain the upper hand and get out of debt.
 

Photo by BookMama.

Get Out of Debt on Your Own

1. Call your creditors and ask them to lower your interest rate
2. Take advantage of promotional interest rate offers that make sense by transferring the highest rate accounts to them.
3. Make minimum payments on your accounts except for the one with the highest rate (target account), which should get the largest amount.
4. Analyze your monthly expenses and trim them where possible, using any extra funds to make an even larger payment on your target account.
5. Be creative in finding ways to increase your income, again applying the extra funds towards getting out of debt.

Keep track of any changes to your accounts, such as the interest rates and due dates, so that your payments are always on time and you are making the largest payment on the highest rate account. Be sure you are aware of when any promotional periods end, and that you know what the new rate will be.

Get Out of Debt Through a Debt Solution

If your efforts to get out of debt on your own have been unsuccessful, or your debt problem is just too overwhelming, then you may need to consider a debt solution. Some of the available debt solutions, however, can cause even more problems, so you should carefully analyze each one and weigh the benefits and risks.

Damaged or destroyed credit, judgments, wage garnishments and having your accounts sent to collection are all possible consequences depending on the specific solution you choose to get out of debt.

For consumers with a serious debt problem, the three most common solutions to get out of debt are:

1. Credit Counseling
2. Debt Settlement
3. Bankruptcy

When considering which debt solution is right for you, it is important to analyze both the pros and cons involved with each option. For many people, it makes sense to consider the most balanced solution that will get you out of debt with the least amount of damage. The most responsible solution is credit counseling.

Credit counseling does not require you to accept damage to your credit as both debt settlement and bankruptcy do. In fact, the credit damage that these debt solutions will cause is very serious.

Debt settlement requires you to stop making any payments to your creditors until a settlement has been reached with them, which obviously will have a significant negative impact on your credit.

Bankruptcy will ruin your credit for 7 to 10 years. This being the case, it only makes sense to find out first if credit counseling will sufficiently get you out of debt. If it does, then you’ve sidestepped the serious consequences you would have exposed yourself to with debt settlement or bankruptcy.

If you should instead decide that credit counseling doesn’t fit your circumstances, then you can always investigate the riskier alternatives at that time. The important thing is to get out of debt, and to do it in a way that causes the least possible damage.

To find out if credit counseling is the right way for you to get out of debt, you can fill out the online form on the right and an experienced debt advisor will contact you to discuss your situation.

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