Get Out of Debt

In the earlier years of this century, a popular way to consolidate debt was to refinance your house. I know- I wrote a lot of debt consolidation mortgages back in those days.

What with the current state of the economy and the depressed housing market, refinancing is not such an easy option anymore. The Federal Government is bailing out banks and mortgage lenders right and left and the money just isn't flowing as freely as it did a few years ago.

That means people who need to consolidate debt have fewer options. If you have a bunch of credit card debts and don't want to (or can't) refinance your house, there are a number of options. In these times, keeping more of the money you earn in your pocket is important. Fuel and heating costs are going through the roof, so you'll need every penny you have (just make sure you have enough left over to buy a couple of hot dogs).

BEWARE OF DEBT ELIMINATION SCAMS! There is no such thing as "DEBT ELIMINATION," despite what some unscrupulous internet marketers would lead you to believe. The only way to eliminate debt is to PAY IT! The simplest way to pay of credit card debt is to reduce the interest you pay. This can be done with "zero percent balance transfers" where you can pay off one credit card with another that has a zero percent interest rate. The most important thing to do is pay the debt down while there's no interest and DON'T PILE UP MORE CHARGES ON THE CARD YOU PAID OFF. You could also explore a low interest unsecured loan from your bank.

If borrowing to pay off debt isn't in your plans, debt settlement is the best bet short of bankruptcy. Your credit rating will get whacked, but you can work out a plan where you can reduce the dollar amount of your debt and/or pay it back slower at lower rates. You'll be able to pay off your debts AND keep more money in your pocket too.

Whatever you do, look into all the ways to consolidate debt that are available to you. Every penny counts!

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1 comment:

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