Explaining Debt Consolidation: 3 Tips for Climbing out of Debt for Good

Most people can remember the very first credit card they applied for and received like it was yesterday. It was a very exciting day, and shopping was most likely on the agenda. They had just started a new job with great potential and life was good. After making a few payments, new offers for credit started coming in the mail.

The credit cards soon became a way of life, with the cardholder using them instead of earned cash to pay for food and other needs. Paying the minimum payment or paying with a check received from another card company was what most of their friends were doing. Pretty soon, paychecks weren’t enough to pay the interest let alone paying down the balance. Now the credit card user has become a slave to the card they were so excited about.

Getting Out of Debt is Possible

One of the first things to do is decide to get out of debt. If a person who’s in serious debt really wants to get out of a terrible situation, it’s going to take gumption and will power. Using credit cards may have become obsessive and require everyone in the family to get on board with getting out of debt. First of all, a commitment must be made to stop using credit cards. If payments are not made on time, the credit bureaus will be alerted, and the card companies could raise the interest rates further making them virtually impossible to pay off.

Before that happens, a debt consultant should be called to help show the individual what they could do without in order to pay off the card with the highest interest sooner. Then, they would use the extra money from that card to pay the next highest and so on. Log onto debtconsolidationusa.com to read the articles about their company that has helped countless couples who have been at wit’s end to get their lives back in order.

Working With a Debt Counselor May Help

The second thing a person can do is call the credit card companies themselves and explain they no longer have the money to pay the debt. They can ask them to work with them by lowering the payment or interest. Sometimes, credit card companies are very understanding and even offer assistance in finding their clients a debt counselor who will help them.

The debt counselor talks to them and asks many questions such as how many times a week does the family eat in a restaurant or purchase carry-out food? How many cell phones do the family own and need to be paid for each month, and how much do they spend on name-brand clothing and shoes? How many movies do they see each month, and how much is their monthly cable bill? These questions may be unsettling to parents who want their children dressed like their friends, and they may not want to give up anything, but they’ll also see the amount of money they could pay on their credit cards until they got their financial lives in order.

A Debt Consolidation Could be a Wise Course of Action

While some credit card companies may be very understanding especially during lay-offs due to the coronavirus epidemic, others will hurry up and place a lien on the property their client owns. The third possibility of getting out of debt is to make a major decision to find a debt consolidator that’s above board and highly recommended by people they’ve helped.

If a person has owned a home for years, they could take out a home equity loan and pay their debts that way. They should also remember that if they don’t make those payments, the home they’ve paid on for years could be foreclosed on, leaving them homeless.

While a person’s credit rating is still fairly high, it may be time to check out debt consolidation where the bills are added together and a loan is taken out that will repay all of them and save an enormous amount of money. Remember, that not all credit card companies care whether you’re in trouble or not. All they want is their money and this certainly gives their clients a reason for not using their credit card again.

Professional Debt Consolidators Offer Help

Debt consolidators can give their clients much advice on which way they could go in order to erase their debt. They can put all the above tips together by consolidating their debts, possibly using the equity in their home, and stopping all credit card usage. One important thing to remember is that some people will go right back to using credit cards to pay for essential needs and household items and food. This is why will power and gumption were mentioned early on in this article.

It’s very nice to have extra money, but it shouldn’t always be someone else’s money. Once all the bills are paid and there’s just one monthly bill to pay on the consolidation loan, it’s time to see there’s a new way of life where bills are paid with the cash that’s earned from a job. During lay-offs, immense care of the family’s finances must be taken so they can remain afloat.

This is a sad time for everyone who’s used to living a good life with consistent paydays, children in school, and having friends over for dinner. Now, with an epidemic keeping employees from the jobs they love and indoors at home, money worries are setting in. Many families have children set to graduate from school and college who have to be satisfied talking to friends over their computers. It doesn’t seem fair that, on top of a devastating sickness, families should have to worry about losing their homes. Debt consolidation can be a temporary means of dealing with creditors and making sure credit ratings remain stable. This is also a time to realize that it won’t always be this way. Life will eventually get back to normal.

Featured image source: Freepik (Affiliate Link)

Published by Nishitha

I am done with my Physiotherapy Graduation. And I always try to share Health and technology tips with people. Apart from Physiotherapy and being a tech savvy, I do explore more on Technology side and I keep sharing my findings with wider audience.

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