Tag Archives: Debt Management
Credit Counseling & Debt Management 4
The 4th in a series of educational videos from the MoneyHarvest Institute. We help change lives for the better and empower people to have Prosperity Thinking. More about us and our non-profit Christian Credit Counseling Services at www.cccfree.org
A third (31 per cent) of people seeking statutory debt solutions are still getting harassed by creditors, even though there are procedures in place to prevent that happening. Of this number, nearly a half (44 per cent) have filed for bankruptcy, whilst a quarter are in an Individual Voluntary Arrangement (IVA). The figures from R3, the insolvency trade body, also show that a similarly high number (44 per cent) of people in more informal Debt Management Plans (DMPs) are still being chased by the people they owe. Steven Law, the president of R3, says it is astounding that people are still being harassed, even though they should be protected. He remarked: The decision to file for bankruptcy is a difficult one that, once taken, is meant to stop the endless contact from creditors. That such a large proportion of bankrupts are not afforded the peace of mind they are entitled to is of grave concern.” Kevin Still, director of Atlantic Financial Management, says: “One of the fundamental roles of a Debt Management Company, like Atlantic Financial Management, is to protect their client from on-going creditor collection activity once they start their Debt Management Plan (DMP). “The OFT Debt Collection Guidance provides clarity on what a lender or their debt recovery agent can do once a debt advisor is appointed.”
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Debt Management Help – 7 Great Tips
Debt is a way of life in America, so much so that many households are looking for debt management help and ways to decrease debt. It may seem to be a simple task but many find it difficult to wean themselves from a steady diet of credit and the immediate satisfaction of a credit lifestyle.
Debt free living is achievable. Those that embrace that lifestyle find that it can be very rewarding and stress free. The seven step below provide debt management help and will get you started in that direction.
1) First and foremost, find a way to cut back your spending: This process starts by knowing what you are spending. Evaluate everything that money is spent on for its true importance and priority to you and your family. Look at everything from the cable TV bill to dry cleaning to dog grooming. Make a list of things that can be cut out or trimmed significantly. Take this list to the next step.
2) The second imperative, you must make yourself a budget: Make a list your bills and all of their due dates. Is this a budget you can live with? Does it list all of the necessities or does it still include frivalous spending? The budget and sticking to it is the key to your success for getting out od debt.
3) The third step is to minimize how much credit you use. Focus on using cash as much as possible in all of your purchases. If you have to use credit then focus on paying it off as soon as possible. Paying the minimum on credit card bills is a recipe for overpayment and enriching the banks.
4) The current sound advice is to pay off balances but to not cancel the credit cards. As illogical as it sounds the credit ratings services favor people who have credit available to them but who don’t use the credit. The goal is to favor those that manage their credit. So don’t automatically close the account when it is paid off. Just put that credit card away and hold it in case of an emergency.
5) Pay off the smallest debts first: Paying off the smallest will allow you to take thosee funds and quickly apply them to the larger debts. Paying off a debt also provides a sense of accomplishment that is very satisfying. Just go in that order and pay off each debt one by one and before you know it you will have all of them paid off.
6) Debt Consolidation is a potential solution. There are companies that offer debt consolidation services. These companies will call your creditors and make payment arrangements for your debts. Many companies will even get you established with low monthly payments until the debt is paid off.
7) Get some professional debt management help: Make an appointment with a financial counselor to show you how to reduce your debt. Some people find financial counselors a very bit help simply because they tell you what you need to do. They can also tell you how to better manage your money and stick to a budget more aggressively.
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How to Avoid Bankruptcy and Keep Your Sanity
In our society today many people are hurting and are out of jobs, so much financial stress. Instead of trying to avoid bankruptcy, a lot of people look at bankruptcy as the last hope for freedom, and some people choose to file too early. Even with other alternatives such as debt consolidation, they just get tired of the debt and file for bankruptcy.
There are many different options that are available to an individual or individuals that do not want to file for bankruptcy. The most option those individuals choose to take is the debt-consolation loan which and then closing all of their existing credit lines.
What is debt consolidation? It is simply a new unsecured loan that one takes out to pay off his or her debt.
An unsecure debt consolidation loan helps a person take all their debts and puts them into one loan simply to avoid bankruptcy. This money that one borrows can save a person hundreds of dollars if the choose to pay off the debt that they currently owed. Even if you do not own a home then you can still get a debt consolation loan.
These debt consolidation loans are financed out over a longer period of time at a low interest rate. With that said your monthly payments will be lower. If you secure your loan on your home then your payments may even be lower.
But there is two ways to consolidate a debt that you owe so you must weigh the pros and cons of the two. You can either borrow the money to pay off the debt that you currently owe or you can contact a debt consolidation provider, either way it is your decision. It will all depend on your needs and what you can do, if you can qualify for a loan for the amount that you need to consolidate for.
What does debt consolidation do for a person? It brings all your debts into one payment, eliminating a lot of different payments. Most importantly it will not hurt your credit, but may even help your credit, it may in some cases eliminate some interest and some fees. Not to mention immediately lowers your monthly payments.
When you get this loan and if you use it to pay off credit cards, you save a lot of money with interest. Once you have paid off all of your debt, then you will have a fresh start with your bills and can set up some sort of budget that you can live by.
Debt consolation is a great way to help you with your debt when you just can’t seem to fix it or keep it straight on your own.
There really is no way for a person to actually fix their bad credit without the ability to decrease debt and pay their bills on schedule. Still, once your debt has gone so far out of control it can seem nearly impossible to reach that goal of freedom.
Who can provide me with this information? A credit counselor will help you get a solid debt management plan, which should provide immediate relief and also allows the repayment of the debt without the high fees and the negativity that bankruptcy brings.
Whatever you decide is your choice and is based on your financial status, as well as suites your lifestyle and what you believe.
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Debt Management Partners
Many people find themselves in a situation where they are unable to make repayments on a debt due to unforeseen circumstances. The loss of a job or a catastrophic illness can easily be the cause. If you find yourself in this situation then a debt management plan may be the answer. Its important, however, to investigate the plans that work versus those that don’t.
A debt management plan begins with negotiating a stop to interest and late payment fees on the account because these are key steps to reducing debt. A critical second part of the plan should include an effort to start the process of credit repair where a counselor will go through the credit file to identify unfair penalties and attempt to overturn them. Some believe that this is impossible once the damage is done to your history. This is a myth because many people repair their records over time.
Debt management is not ever going to be the most simple process. Banks have the upper hand and they are tricky to deal with when they feel that they are going to be able to get money out of you one way or another. That is why you must think before choosing your debt management partner. The right one can be your pathway to financial security and the wrong one could leave you even worse situation.
Find a solid partner in the journey back to credit respectibility and alleviation of debt and you will be able to live with a little less stress.
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