subject: Unsecured Debt - What Do You Do When Your Debt Has Gone Out of Control [print this page] If your unsecured debt is not manageable, it is a clear indication the spending habits need to be modified. We would have never realized it until the recession affected the global economy. This is a greater responsibility, much beyond an individual's or an organization's. It has to be restructured at the global level.
If you have lost your job and have no means to pay the credit card debt, it is time for introspection. Collect all the cards you have. Bring together the latest bill statements and see how many are paid on time and how many are past the due date. Well, now is not the time to repent, but to make a strong and wise decision.
Take a pen and paper or in an excel sheet, prepare a budget, list down all your assets and liabilities, the secured and unsecured debt. Prioritize your requirements. Cut short all unnecessary expenses or procrastinate the expenses if possible. This will give you sufficient insight if debt payment is still possible for you. You will be lucky if you find, cutting down expenses and a proper budget planning helps meet the loan repayment.
But if not, call up your creditor and ask for a waiver on the debt. Creditors might be able to eliminate your debt by providing a low APR or waiving off the late payment fees and over due payment, which are the main components of the financial charges. These charges generate the largest chunk of revenue and profit for the credit card companies. You might be wondering what must be the incentive behind the leniency of the creditors.
It is all a matter of times, both the lending and borrowing should not surpass the capability of one handling it. Living beyond means, is like stretching out of your own capability. The recession, justifies asking for a debt reduction. However the lenders might question your integrity, inability to pay the debt and doubt on further commitment to pay debt, upon reduction. This credibility can be won over by a debt settlement company. They have professionals who negotiate with the creditors on your behalf to eliminate the debt. Their expertise and experience over the years is significant in building trust with the creditors.
If you do not plan to spend further on an intermediate agent like Settlement Company, refer a credit counseling agent. They are mostly non profit organizations and aim to protect customer interest by advices and guidelines. They arrange training and classroom sessions for elaborate discussion on credit handling. Debt management program can also be adopted for debt relief. This program assures a safe credit score besides reducing debt.
For the millions of Americans who are at least $10 k in unsecured debt, it would be financially prudent to consider the debt settlement option. Creditors are very worried about collecting their debts and legitimate debt settlement companies know exactly what methods to use to get your creditors to agree to eliminate a certain percentage of your unsecured debt.
Unsecured Debt - What Do You Do When Your Debt Has Gone Out of Control
By: Benjamin Axel
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