Even if you took on unnecessary debts with the best of intentions to pay them off, it doesn't always work out that way. If you have too much debt to handle, you should get help to get it under control before you have no choice but to file for bankruptcy. When should you ask for help paying your bills? If you are missing payments or just making the minimum payment each month, you should talk to a credit counsellor or come up with a plan to fix your credit problems.
When it comes to taking care of your debts, you have a few choices. You can do this by making a budget that makes sense and gives you enough money to pay off your bills as best you can. Remember that if you only pay the minimum, your balance won't go down much because interest is added to it every month. A minimum payment, on the other hand, makes sure that your accounts are in good shape and keeps creditors from bothering you.
Self-Help Guides
For people who want to handle their debts on their own, there are many self-help books and websites available. You can also talk to your creditors and tell them what's going on. You might be surprised by what happens if you just call them up.
But most people get help from someone who works in the credit industry. There are many credit counselling services to choose from these days. An agent will help you make a budget that works and figure out a way to pay off your debts. Most of the time, they will talk to your creditors to work out new payment terms that are easier for your budget.
How to Deal with Your Debtors
Your credit counsellor may also sign you up for a programme to help you deal with your debt. In this programme, they will add up your monthly payments and figure out how much you owe each month. You will make only one payment to the credit counselling agency, and they will pay your creditors on your behalf. This is especially helpful for people who have a lot of debts and can't keep track of them all.
If you do research online, you can find a legitimate credit counselling service. Ask for recommendations from people you know to find agencies with good reviews. Ask about their prices, their credentials, and how long they've been in business. Most of the time, agencies that have been around for a while are good to work with. Credit counselling services that don't charge fees are usually your best bet.
Pay off what you owe.
You could also get a consolidation loan to pay off all of your debts at once. After that, the only thing you have to do is send your monthly payment to pay off the consolidation loan. Some people use home equity lines of credit or personal loans to get a consolidation loan. If the interest rate on your consolidation loan is less than the rates you are paying now, you will save money in the long run.
No matter which option you choose, it's okay to ask for help. Filing for bankruptcy can cause a lot of problems, and it will stay on your credit report for up to ten years. The best thing to do is to know when to ask for help before it's too late. Check out some of the federal government's publications for more help if you are having trouble with your credit or debt.
