Do you sometimes pay your credit card bills late? Are you getting more and more mail from people who owe you money? Do you worry that if you can't pay off your credit card debts, you might lose your property?
Being in a lot of credit card debt is not something you can just brush off or ignore. Whoever has been in this situation knows how awful it is. But if you get into a lot of credit card debt, there are things you can do to keep your finances from getting even worse.
First, make a budget right away.
Don't wait until you lose your house. Make a budget as soon as you find yourself in a bad financial situation. How much money do you make? Does it cover your expenditures? Look at your situation and decide which costs are necessary and which aren't. Do you have to go out to eat three times a week? Do you really need all the extra features that come with your phone plan? Do you have to buy new clothes every week? Your budget needs to cover all of your basic needs, like food, shelter, clothes, basic utilities, and health-related costs.
Tip #2: Deal with your debtors.
Many people get rid of their debts by avoiding or running away from their creditors. Dealing with creditors in this way only makes things worse and bigger. If you are having trouble paying off your debts on time, the best thing to do is to talk to your creditors as soon as possible. Tell them why you can't pay your debts and ask them if they can help you come up with a new payment plan. You should let your creditors know that, even though you have debt, you are very willing to pay it off. Face up to your debts. Don't let it get to the point where they send your case to a company that collects debts.
Tip #3: Deal with people who are trying to get you to pay back money you owe.
The Fair Debt Collection Practices Act is a federal law that makes it clear that debt collectors can't bother you, lie to you, or do anything else that isn't fair when they are trying to get you to pay them. Read this federal law and make sure you understand it so you can talk to debt collectors in the right way.
Tip 4: Think about getting credit counselling.
People who are having trouble with their money can get help from groups and institutions that offer credit counselling. A good credit counselling service can help you figure out how to pay off your credit card debts in a better way. You can show this plan to your creditors and ask them to agree with it.
File for bankruptcy. This is Tip #5.
Filing for personal bankruptcy is the only legal way to deal with your credit card debt when all else fails. But remember that if you file for bankruptcy, it will stay on your credit report for a long time. So, if you have a bankruptcy on your credit report, it may be hard for you to get more credit, buy a house, or even get a job.
