Anyone dealing with the stress of mounting debts can attest that you often feel overwhelmed. Sometimes we choose to simply ignore the issue. Others might opt for skipping payments or borrowing more money to pay off current credit cards. The important thing to remember is that there are options available for you.
Most likely, more options for dealing with your debt than you ever imagined.
Finding Money To Pay Down Your Debts Faster
If you can come up with a enough cash to pay off some of your debts, your financial burden is sure to improve. The key here is not to jump at every opportunity to get cash fast. Most of these payday loans or cash advances have serious problems and if you make a poor choice, you’ll only find yourself in a worse situation- financially speaking.
Sell Off A Major Asset
Selling your car or other big investment is one of the best ways you can quickly get cash. Particularly if you are no longer able to afford your car payments. If you have any type of public transportation available, this can often times be a quick help for the bulk of consumers’ debt.
With the proceeds, you should have enough to pay off outstanding debts owed on the vehicle. Use what’s left to help pay down your other debts. One note of caution is to be realistic before you sell off your car. If you think you can just get a new loan and a new car, you might be better off considering a different path. We want to get you out of debt for good and not just into a new shiny car.
Cut Back On Your Budgeting For Non-Essential Items
Cutting your expenses is almost a no brainer at this point. Showing your creditors that you are trying to live frugally and are making an effort can go a long way with getting them to work with you, it can also help with your annual credit report rating.
- Become A Extreme Couponer – Clipping coupons like they are gold. Stack them with in-store deals and buy generic products if possible. If you’ve never tried this before you might be shocked at how much you can lower your grocery bill each month.
- Cut Back On Luxuries – Cancel your cable TV, internet subscriptions immediately. You can get most major networks with a good old-fashioned set of ‘rabbit ears’ and free wireless hubs are abound everywhere now-a-days.
- No More Eating Out – Start bringing your own lunch to work and cooking for yourself at home.
- Sell Of Your Old Clothes – eBay is often overlooked for actually selling stuff we no longer use. By the same coin, if you need to buy something use second-hand shops or thrift stores if possible.
Tap Into Your 401k
If you have an 401k or other retirement account, you can get cash to pay off debts by withdrawing money from it before retirement. In essence, you are borrowing from yourself and in most cases you will have to pay withdraw fee and taxes on any amount you remove.
Apply For Equity Line Of Credit
Most lending institutions such as banks, credit unions and other mortgage lenders offer home equity lines of credit. Sometimes called a 2nd mortgage, these loans require that lenders re-assess the value of your property and this determines how much you can borrow against up. Basically, you are putting up your property as collateral. The amount extended will vary, but is usually a percentage of the market value of your house.
A equity line of credit doesn’t come without any risks though. If your debts are unsecured and your house is exempt from collection, it’s almost never a good idea to put your home up because you are then jeopardizing it by getting a s borrowing against it.
On the other hand, if your like a large chunk of US homeowners these days your mortgage may be the main culprit in your debt problems. When the housing market burst in 2008, the crisis sent shock waves around the globe and nearly brought our financial markets down. If you are in a situation like this a mortgage modification or re-fi might be better suited to help you get back on secure financial ground.
We hope that you realize now that you have options available to start fighting your debts. Other sometimes unpleasant (we didn’t even mention asking friends of family members for help), getting started paying down the total amount you owe is always the smartest choice. In the long run, you will be much better off for improving your credit ratings.