Getting out of Debt

As the new school year begins it is time for the consumer's to take hold of their unsecured debt. This debt will only grow over the next several months as the holidays approach and will continue to add pressure to the family situation.

So how does the consumer stop this pressure and get out of debt? One of the ways to put the brakes on this situation is to consider a debt settlement program. A debt settlement program is designed to reduce the overall unsecured debt of the consumer.

The program establishes a "trust account" into which monthly payments are make until there is enough money to begin to negotiate with the lender. In most cases, the debt settlement company can reduce your debt up to 50% or more. This may be a better alternative than to file bankruptcy or doing nothing about the situation. If you are considering bankruptcy please consult with an attorney before taking that step or at least call a debt settlement company to understand your option.

The debt settlement program will have some possible drawbacks for the consumer which need to be considered. The consumer's credit report will take a hit in the beginning of this process however the consumer's credit may already been hurt by:

· Too high of outstanding balances
· Late Payments
· Too much credit
· Tax liens, judgment's, repossessions, etc

If the consumer does consider the debt settlement option. They then had started the journey of getting out of debt. One of the positives to possible come out of this unfortunate situation is the consumer is now motivated to learn how to handle their expenses and money in the future.
Other consideration that the unpaid balance maybe considered income and is therefore taxable under your normal tax rate.

There is no easy fix to large amounts of unsecured debt. But the consumer needs to face the situation head-on a deal with it in a responsible manner. So call a debt settlement company today to discuss the complete ins and outs of the program. Give you and your family a new peace of mind and start anew.

Addiction to Credit Cards

In today's society many Americans are addicted to buying almost everything on credit. Perhaps out of convenience - to simplify their life or maybe out of personal or economical hardship. The retailers make it possible for us to thrive on this concept with buying everything on credit.

However, it doesn't take long before your wallet is filled up with bank cards and department store cards. Most people think that it is easy to pay them off at the end of the month. Easier said than done. Many people start to justify reasons to use the cards. It's easier than to part with cash.

The debt builds up slowly with no major purchases to show for. And before you know it - you can be thousands of dollars in debt with no end in sight. This type of consumer debt is considered unsecured debt verses secured debt. The difference between the two types of debt is at secured debt is backed by some type of collateral with fixed payments to reduce the debt while unsecured has high interest rates, no tax advantages and is not collateralized.

In the beginning, the consumer feels it's alright about repaying only the monthly minimum payment because they believe the next month they will be able to paid more on their account. This gives the consumer a feeling of confidence to continue to spend more freely and leads them down the path of spending more than they earn each month. However this spiraling debt only continues to grow and the consumer is now facing added pressure to met their financial obligations.

Because of this spiraling debt, the consumer needs to consider how to get out of debt. One of the options for the consumer is debt settlement. Debt settlement is a method by which a third party works on the consumer's behalf to negotiate with the credit card companies. This process requires the consumer to stop using their credit cards, budget their finances and start saving a certain amount of money each month. This money is placed in a "trust" account and until it achieves at least half of your lowest balance credit card before the third party company can start negotiating. This process may take between 12 months to 48 months to clear all of your unsecured debt.

Now is the time to explore how our debt settlement company can help you out of the depths of financial problems. Contact Debt Free Partners to speak with a representative.

How do credit card companies try to trick you

Look at your statements carefully each month. Credit card companies are famous for changing your billing cycle. If you have been on a 30 day billing cycle, it is not uncommon for them to switch you to a 20 day cycle. This is how I got a late once.

You also need to be aware that when you transfer a balance to one of those snazzy 0% offers, the rate only applies to the balance that was transferred. Any new purchases might be at a different interest rate.

Keep in mind that your credit card company is not your friend. They are predatory and want to keep you in debt.

Drowning in Debt?

Drowning in Debt? If you are serious about getting out of debt you need to start living by your needs and not your wants. The only things that your really need are food, clothing, relationships and transportation. You don't need a 60 inch new Sharp Aquos flat screen tv. Your old tube set will still work.

Do a budget and take a look at what all of your expenses are. Look at where you can cut back. Make sure that you have more money coming in than going out. You may need to get a better paying job or take on a second job. Being in debt sucks and I would do whatever it takes to get out of it.

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Credit Builders - Simple tips to raise your credit score

Credit Builders can be free and easy if you know what the rules for credit reports are. Don't cancel your credit cards even if you are not using them. Roughly 15% of your credit score is based on your credit history. If you cancel the cards, you are canceling the credit history with it as well. Pay your credit card balances off or pay them down to at least 30% of the available credit. The amount of your debt load will account for over 30% of your score. Paying off debt can have a big impact on your credit score.

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Can my credit card company sue me?

Can my credit card company sue me? If you stop paying your credit card bill, your credit card company can sue you for payment. They will tack on late fees and interest as well. Your best bet is to just keep paying your bills on time and stay out of trouble.

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What is consumer debt?

What is consumer debt? Consumer debt can take many different forms. It is typically understood to be any debt that has to do with the acquisitions of goods that are consumable. A car is a consumable good because they don't last forever. Typically a consumable good will depreciate in value over time. It is very common now for people to buy consumer goods with their credit cards. Any balance that is carried on a credit card is considered to be consumer debt.

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What is the Universal Default Rate

The Universal Default Rate in relation to the financial services industry allows a lender to change the term of a loan from the normal terms to a new default term. Typically a default rate will be activated when loan payments are missed or a loan goes into default. The term is most associated with credit cards in that when a consumer fails to make a payment on a credit card, interest rates can soar to over 30% in some cases. Once you are in a default rate on a credit card, there is not much you can do to get out of the high rates. You may want to consider doing a debt consolidation program. Once you enter a debt consolidation program, your interest rates will be reduced, over limit fees stopped as will as late fees.

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Credit Cards Are Convenient - But Using Them Can Hurt Your Credit Scores

Buying gifts for friends and family during the holidays can either be fun or stressful. I tend to fall on the side of stressful and overspend. I also tend to put a little more on my credit cards than I should, so this year my wife and I are waiting until after the holidays to get each other presents. This gives us the chance to see what we get from other folks, and allows us to catch up on our bills. This might be an option for you. It might not, but here is another options to use to get out of ...


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Buy Now Pay and Pay Later

Credit Card companies are not your friend. They are in business to make money off of you. If you can't pay cash don't use them. Emergencies can be the exception. Buying expensive cars that you have to devote a huge amount of your time to pay back doesn't make much sense. Do you really need it or do you want it? I would rather be debt free and not have to go to bed every night and worry about how I can pay for all of the things that I owe. As a former loan officer I don't know how many people that I met with that could not buy a home because they were driving big expensive cars. It just is not worth it to drive a fancy BMW and not own a home.

It's sad but I remember talking to one couple that made less than $4000 a month and had a truck payment of nearly $1000. This didn't take into account gas and insurance. They couldn't figure out why they were broke every month. I couldn't figure out why they thought they could buy a home when they were barely making it as it was. I drive a 10 year old car with 95000 miles on it. It's paid for and runs. I'm happy. New cars are fun when you drive them off the lot, the first payment letter will cure you of that.

Alternatives to bankruptcy

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