Over the past week, I have discussed many ways to approach a do it yourself debt reduction and credit repair plan. A lot of your approach will depend on your situation, so I covered a variety of different angles.
Consolidation loans are one of the options to consider when you have many creditors. These are particularly useful if your credit score is still good or if you have a lot of equity in your home. That way, not only can you often create one loan payment, you can often also reduce the interest you are paying. The key warning with this type of strategy is to avoid using your credit cards once you pay them off. If you start accumulating credit card debt again, you have just added to your problem, instead of remedying it.
Eliminating credit card debt is also another approach if this is your main issue. In DIY Credit Card Debt Reduction, I provide some ideas on how to approach this strategy. Credit card debt is truly one of the worst kinds to have, as the interest rates are usually higher and the debt is often accumulated with small purchases you may not ever remember making.
If you are like the typical individual, your debt is spread out over lots of different kinds of accounts. With multiple creditors, the best approach is to organize them all into a spreadsheet and evaluate each one separately. This organized strategy will ensure you pay off the most important ones first.
If the possibility of mortgage foreclosure is in your sight, then you must read DIY Mortgage Repair. Don’t become another recent news story!
If you have a ton of assets and a ton of debt, often the best idea is to sell it all off. Then use the cash to pay off your debt. Learn more in DIY Debt Reduction – Get Rid of Stuff.
The last article in this series addressed the concept of collections agencies. If your accounts are being sent to collections, you need to act now. Read this entry to get you going.