5 Methods Toward Reducing Your Debt
Decreasing your debt is paramount to having a good credit rating as well as giving you peace of mind. You want to get out of debt, but not all debt reduction options may be beneficial. Let's take a look at five debt reduction options which may help you in your quest to get out of debt.
1. Consolidate Loans. Before declaring bankruptcy, consider pulling together all of your outstanding loans into one low monthly payment. Loan consolidators can help you come up with a plan to pay off all of your debt while maintaining your credit standing. Bankruptcy, unfortunately, ruins your credit rating while a consolidation loan may help you save it.
2. Your Life Insurance Policy. Your life insurance policy may have a cash value to it. Consider taking the cash from the policy and using it to pay off or lower your debt. Of course, your payout will be much lower upon your death; make sure your loved ones are adequately provided for when you have released this mortal coil.
3. Federal Loans. Government loan programs - local, state, and federal - may be available to you and at a rate much lower than what you currently pay your creditors. Check out loan programs, which you must pay back; as well as grants, which are gifts to you to see what your eligibility is.
4. Borrow From Your 401(k). If your company has contributory retirement plans such as a 401(k) or 403(b), you can take out a low interest rate loan and use the proceeds to pay off what you owe. You are borrowing from your retirement account so your loan must be paid back; if you do not pay it back you will incur IRS taxes and penalties. Still, the borrowing rates are quite reasonable.
5. Bankruptcy. The U.S. constitution gives Americans the right to discharge debt, and it is one option some must take in order to get creditors off of their backs. With medical expenses surging, gas prices hitting record high levels, and many other expenses increasing, bankruptcy may be your only choice to help protect your assets from overreaching creditors..
Obviously, some of these options have different consequences than others - like a ruined credit standing - still, when your back is to the wall your choices are extremely limited. Find your comfort level and choose an option that is right for you.
Matt Keegan is The Article Writer; you can view his work at http://www.thearticlewriter.com
Is My Credit Card Debt A Problem?
For most Americans, credit card debt is a dangerous and growing problem. The average American family has more than $8000.00 in credit card debt and spends more than they earn on a annual basis. Credit cards can be useful tools when they used properly, but more and more Americans are getting in over their heads and threatening their financial futures. It is important to realize that just because you can pay your minimum payments each month doesn't mean you don't have a credit problem. Low minimum payments benefit the credit card company, not the consumer. The following are some of the warning signs that you have credit or debt problems:* You are unable to ...(related: Debt Relief)
Personal Bankruptcy ? If Its Unavoidable, File Now
The Bankruptcy Abuse and Consumer Protection Act, signed into law by President Bush last April, promises changes to Federal bankruptcy law that have been long sought by the lending industry. The bill promises sweeping changes to Federal law, and will make it much harder for the average consumer in financial trouble to have their debts wiped out by filing for bankruptcy. Recent trends suggest that those considering a bankruptcy filing should do so now, as the line to do so is already getting rather long.The bill will make it harder for the average consumer to file under Chapter...(related: Debt Relief)
Are You Sure Your A Bad Debt?
Many people who seek the advice and guidance of debt counsellors are driven to them in the first place by fear and ignorance ? two powerful emotions which often mask the real scale of the problems.<...(related: Debt Relief)
Reduce Your Debt
Do you want to reduce your debt? Having trouble paying your bills? Getting dunning notices from creditors? Are your accounts being turned over to debt collectors? Are you worried about losing your home or your car?You're not alone. Many people face a financial crisis some time in their lives. Whether the crisis is caused by personal or family illness, the loss of a job, or overspending, it can seem overwhelming. But often, it can be overcome. Your financial situation doesn't have to go from bad to worse.If you or someone you know is in financial hot water consider the options below. How do you know which will work best for you...(related: Debt Relief)
How Do I Lower My Debt Burdens?
How do I lower my debts?There are several ways of improving your credit status. If you have decided upon taking up firm steps to decrease your debts, then you may...(related: Debt Relief)
The Bankruptcy Code Acknowledges The Validity Of The Homestead Exemption
Many times the subject of bankruptcy seems baffling in its complexity. Actually the basic principals of bankruptcy are fairly simple even though the federal statuses on bankruptcy are extensive. The reason that the statutes are so complex is because in as effort at social engineering, the lawmakers want to cover every possible contingency. The very complexity of the Bankruptcy ...(related: Debt Relief)
Fast Track Out Of Debt
You go to the mail box and scan - a couple fliers (nah), your magazine subscription (yes!) and bills (groan). Every month the bills show up and as you sigh and take out your check book you wonder if you will ever be free.Each month yo...(related: Debt Relief)
How To Avoid Medical Collections
With medical collections costing doctors millions upon millions of dollars in unpaid bills and collection fees, many people have just one question: Who are these people who are trying to stiff the doctors who delivered them from great physical pain (or the flu, hypochondria, not-so-white-teeth, or a nose that didn't look enough like Brad Pitt's)?Well, I'm here to tell you who these people are, or at least some of them.They're me.Yes, I admit it: I left a dentist's bill unpaid for three months.OK, so dentistry isn't technically considered "medical," but it's the same situation: a doctor left in the lurch.Why did I do such a horrible thing, especially when I, a small businessperson myself, know how difficult unpaid debts can make cash flow, and how it could very easily make me persona n...(related: Debt Relief)
Home Equity ? Foreclosure Often Not Necessary In Current Market
While driving around your community, you may have seen signs posted on telephone poles that offer "foreclosure help." These seemingly generous offers to help financially troubled homeowners who are in danger of losing their homes to foreclosure are actually scams. Typically, the "help" comes in the form of an offer to buy the home for a reduced price from the homeowner. The scammer offers to pay off th...(related: Debt Relief)
Are You Beating Up On Yourself About Debt?
When you hear the word "debt", whats the first thought or feeling that comes to you? For most people debt is "bad" or it becomes the "enemy" and is something that should be avoided like the plague.Having debt does not make you a bad person. The more a situation is judged as being bad, the worse it gets. It's the judgement that you have ar...(related: Debt Relief)
Learn The Five Key Debt Reduction Steps You Must Take Immediately!
Step 1. The purpose of this first step is to bring you back to reality. You must know exactly how much money you owe and to whom you owe it.* Collect all of you unpaid bills and any other evidence of your outstanding debts.* List each outstanding bill on the same sheet of paper. In separate columns, include the invoice or account number, amount due, name of the creditor, and the date the bill can be paid in full without incurr...(related: Debt Relief)
Corporate Debt Management ? Perspective On The Why
Entrepreneurs have a tough time in their formative years. They try too many things to get a foothold on this competitive business climate, and that too they try them too soon. When they enter into new fields that have great promise and bet on new products they run the risk of costly failures. New product launches are costly and sometimes may take time to click. Risk is one factor which keeps the Businesses spinning new concepts and makes money out of it. It is this risk that keeps the uninitiated away. If you can't risk and make some bets in business then it is no field for you. But sometimes folks go a little far on investing more and more in a failure with hopes that one day they may click. It is the greate...(related: Debt Relief)