Steal My Deal

When you reach the position where you can’t afford your debt repayments, it’s time to take action.

Instead of running from your situation you need to take positive steps to fix it. If you reach the stage where you can’t keep up with the repayments, it’s VITAL that you contact your creditors as soon as possible and explain your situation.

It will help your situation greatly if you mange to contact your creditors before they contact you.

It will show them that you take your situation seriously and have taken responsibility for the state of your finances. It will reassure them that they’re more likely to receive their money….eventually!

Now this may be hard to believe, but your creditors won’t want to take court action against you unless it’s absolutely necessary.

Would you like to know why? Well first, all court action is time consuming, costly and unpredictable. It’s generally a last resort, when all other avenues have been exhausted.

Second, it’s a question of maths. It’s just a simple commercial decision. If you were in the business of lending money and someone was having trouble repaying you, let me ask you a question. Would you rather receive all of it over a much longer period that originally agreed, or 20 cents in the dollar months later when the bankruptcy courts get it all sorted out?

Exactly! There’s no contest. Bankruptcy benefits nobody (well, apart from the lawyers and accountants, but that’s another matter!)

And most lenders realise this!

If they’re offered a reduced payment schedule over a longer period, most will be glad to accept it. In most cases it will allow them to receive more of their money back than the alternative of bankruptcy. And that my friends, is your opportunity to find a solution to your debt problems!

Contact Your Creditors Early

As soon as you know you won’t be able to keep up with your repayments, get in touch with your lender. Write to them explaining your situation, giving them the reasons for your financial difficulties. Creditors will often be open to negotiation, and dare I say it, quite helpful. As I say, they just want to ensure that they get as much of their money back as possible. It may be possible to work out a more suitable repayment schedule that will allow you to pay off your debts.

If you ignore your creditors, they’ll have you in court quicker than you can say bankruptcy! Ignoring letters from creditors tends to make them ratty. Remember, they don’t want to take legal action, unless your actions force them to! But if your general attitude says to them ‘I’m in this position because I spend recklessly and have a cavalier attitude towards my debts’, they won’t have any choice.

Once you’ve drawn up a personal budget and know how much you can afford to pay towards your debts each month, contact your creditors and make them an offer. It’s best to keep your offer of reduced monthly payments as brief and precise as possible. But above all, make it honest and realistic.

This is good ‘I would therefore like to offer $15 per month to repay this account’.

This isn’t ‘I’m hoping that things will get better over the next couple of months, so I’ll increase my payments as much as I can at that time’. Rubbish! The lenders would laugh in your face at that sort of offer!

And whatever happens, when it comes to making an offer of reduced payments, don’t bluff your creditors.

by Stuart Laing

Copyright (c) Get Out Of Debt

Stuart runs a website dedicated to helping people get out of debt. So if you want to improve your financial position, visit www.icanhelpyougetoutofdebt.com for free, impartial information on how to reduce debt.

Accumulating too much credit card debt is probably the number one thing people do to get themselves into financial trouble. Credit cards are so easy to get and once you get them, you only have to pay a minimum amount each month. By doing this your outstanding balance will only decrease by a small amount, leaving you no better off then you were the month prior. Over time your credit card balance won’t decrease much and you will be paying huge amounts of interest. If you get to the point where you can barely pay your minimum amounts it is time to seek credit card debt help.

So where can you turn for some help? There are alot of businesses that specialize in credit counseling and preparing budgets for you to follow. Take a look around the internet and do some research on several of them. Try to research some of the different things they offer you to find the right match for your needs. Comparing some of the higher rated companies is a great place for you to start.

Once you settle on a credit card debt help company, you need to know what type of assistance you can expect from them. They should provide you with a roadmap to follow to eliminate your debts. Additionally you should expect them to give you tips for keeping your debt down once you are free from it. It is important to follow everything they say, and keep following their advice even after your financial situation improves.

What Other Methods Are Available To Reduce My Credit Card Debt?

One way to quickly pay down your balance on your credit cards is to consolidate all of the amounts into a lower interest rate loan. This is called a consolidation loan and is a terrific way to get yourself out of a hole. You will pay one monthly payment, which means you are paying interest only once and usually at a lower rate. The length of the loan is usually fixed and the longer you pay it the more the outstanding balance will decrease.

If you have a good relationship with your creditors you can also contact them to inquire about lowering your interest rate. They will usually work with you if you show initiative before your situation gets too out of hand. Your credit card company wants to get paid each month and they realize that by working with you their chances of that increase. Be professional and courteous, but take action before you get too behind on your payments.

One thing to remember is that you should consider seeking help if you are struggling to even make the minimum payments on your credit cards. By only paying the minimum, or even worse by paying late, your balance will barely decrease and will continue to weigh on you each and every month. Talk to someone who can help and follow their advice. Then exercise control on future purchase to keep yourself out of debt.

James McDonald writes for ‘Helpful Debt Solutions’ which is an online debt management solutions resource. You can find information regarding debt consolidations, loans, credit cards, and other financial topics.

It is always possible to negotiate with creditors - even if they have already taken you to court to get a judgment or to garnish your wages.

Getting a creditor to reduce your monthly payment helps and does provide short-term relief. However, this is only a temporary measure and you need to remember that the interest on your debt will continue to pile up.

You need to negotiate settlements with your creditors to get real debt relief and fix your credit.

Let’s take credit card debt first. Suppose you owe $4,000 but that the original amount was only $2500 and the rest is interest. Let’s also assume you have been behind in your payments for six moths. Call the company and explain the reason why you have fallen behind. You will need to have a real reason such as illness or the loss of a job. Agree to pay $2500 as a settlement in full. In turn, have the company agree to report your account as current to the credit reporting agencies.

Most creditors will buy off on this kind of settlement because they’d rather get the money now vs. having to wait many months or pay a collection agency. So you should be able to negotiate this kind of settlement with many, if not all, of your creditors.

However, some creditors will elect to take you to court to get a judgment. A judgment is a court order stating that you must pay the amount owed. It gives the creditor the right to garnish your wages or seize your assets, including your bank accounts.

Even if a judgment proceeding has begun, there is still time to negotiate a settlement. You can approach the creditor’s attorney (or have your attorney approach the other attorney) and make an initial offer of 40 percent to settle the case. You will probably have to go up from the 40 percent. However, a settlement may be attractive to the creditor because it saves the company attorney’s fees and the cost of seizing your assets or garnishing your salary.

If you do reach a settlement with a creditor, be sure to receive proof of payment. Also, don’t send any funds until you have a legal document that spells out the terms of the settlement. Keep a copy of this document. Make the payment as agreed and then request that the creditor provide you with a receipt or some other proof of payment.

Some creditors, especially contractors and subcontractors and the IRS, can file a lien on your property. A lien is a court order that gives the creditor an interest in a piece of some real property you own such as your home. When you sell the property, the creditor will be paid what he or she is owed out of the proceeds of the sale. Once a lien has been placed against your property, the only way to eliminate it is to pay or reach a settlement with the creditor. If it is the IRS that filed the lien, be sure to get a Certificate of Release of Federal Tax Lien when you do pay it off.
Negotiating with creditors may not be much fun, but it can help you get out of debt and repair your credit.

Have you heard about HD radio technology? It makes AM sound as good as FM and FM sound almost like you were listening to a CD … and its free! To learn more about this amazing new technology, just go my Web site, http://www.hd-radio-home.com, to get all the buzz. Douglas Hanna is a retired marketing executive and the author of numerous articles on HD radio and family finances.

Debt relief is something that millions of people need each year. For those who are looking for answers to their questions of just how to get out of debt, there is a lot of help out there. The question is, though, can they find a way to get out of debt in time? Many keep putting it off getting them farther into debt. When the only answer to debt relief is bankruptcy, people lose all hope. Before you get to that point, though, consider your options.

• You can look to debt consolidation opportunities. There are some loans available that can help you to pay off your debt and consolidate your payments into one. This type of debt relief is often only available to those who have very good credit or collateral to use with the loan.

• Or, you can look for debt relief in debt counseling. In these cases, companies work with your creditors to get the lowest interest rates available for you. Then, you will pay them in lump sum payments until your debt is gone. In most cases, you will be able to save money this way by cutting interest rates and paying a good amount each month on them.

• Debt relief can also come from loans of other types. For example, you can often get an equity loan in your home’s value that you can use to pay off the debt that you have elsewhere.

All of these solutions may or may not work for your needs. While more and more people rack up debt, debt relief becomes harder to find. If you are committed to having the best credit score and a debt free life, you will find a solution for your needs in debt relief.

Ken Austin is the webmaster at http://www.creditreliefonline.com/
and http://www.myfinanceconnection.com/

The overwhelming task of eliminating your debts can often seem like an uphill battle. Without the knowledge and expertise of a professional on your side, unfortunately, the odds are not in your favor. In order to reduce your debt, you have several options; however, if you want to maintain a “good credit rating”, you have to pay you bills on time; anything else will cause your credit score will suffer. With that being said please consider the following:

Option 1 - Consumer Credit Counseling

Consumer Credit Counseling companies were originally established to help credit card company’s recover revenue from clients that were falling behind on their bills. Choosing to use a Consumer Credit Counseling service can have negative effects on your credit that last up to 10 years. These services are also considered Chapter 13 Bankruptcy by most lending institutions. The bottom line is that Consumer Credit Counseling companies work for the creditors and banks.

By using their services, you will end up paying back your full debt, plus interest. These companies do not always provide financial relief as consumers often find out.

Option 2 - Debt Consolidation Loan

Borrowing from Peter to pay Paul is no way to get out of debt. It is however, the premise behind debt consolidation programs. Debt consolidation programs require that financial institutions provide consumer loans based on items of equity. For example, a home equity loan is used to “combine” your debts into a single monthly payment, which can often take 10 to 20 years to repay depending your on financial situation. This may seem like a viable solution in the short term, but missing payments on a secured loan could cause you to lose your home or the collateral you pledged. Many people who decide to go the debt consolidation route find themselves worse off than they originally were. It is not a good idea to exchange your unsecured debts for secured debts.

Option 3 - File Bankruptcy

While bankruptcy may seem to be the most expedient method for removing your unsecured debt, it is not, by any means, the best answer. A bankruptcy will remain on your credit record for 7-10 years and seriously affect your ability to rebuild your credit. Even after a bankruptcy has been removed from your record, you are still required to disclose it on forms and applications; even applications for employment. If you fail to answer this question truthfully it can be considered a crime. Additionally, certain types of bankruptcy can require a court-appointed trustee to control and oversee all aspects of your personal estate. Bankruptcy can have an adverse affect on your credit rating and lifestyle long after the legal matters are over. This is not a decision to be taken lightly. Bankruptcy is an option that should only be explored as an absolute last resort to solving your financial problems.

Option 4 - Debt Negotiation and Settlement Programs

Debt settlement programs provide their customers with a viable
solution to an otherwise complex problem. By helping eliminate your current debt, Debt Settlement programs allows you to regain control over your financial affairs and allow you to become debt free within a reasonable time frame. Debt settlement is fast becoming the only true option to financial recovery! However, I will say it again, even in Debt Settlement you have to pay you bills on time; anything else will cause your credit score to suffer.

Debt settlement is not a Consumer Credit Counseling Service or a
consolidation loan. Debt settlement is a legitimate and legal way of solving your debt and credit problems without the need for bankruptcy. Detb Settlement programs were designed to lower your current debst by 40-60%. Traditionally, this is accomplished by negotiating approved payoff amounts with your creditors. A Debt Settlement program can typically be completed within 36 months or less and eliminate most, if not all, of your current debts.

Alan Barnes
IAPDA Certified Debt Arbitrator and
President and CEO of Debt Regret
http://www.debtregret.com