Being in debt can lead to marital problems and health issues for many individuals due to excessive stress about how to make the next credit card payment. Getting out of debt quickly should be a top priority but how to do that can sometimes seem like an insurmountable obstacle. Excessive debt puts a consumer ever closer to bankruptcy and even if that doesn't happen it can limit access to additional credit limiting choice. Below are some key areas to focus on which can help answer the question of how to get out of debt quickly.
Many times consumers overwhelmed by excessive debt can't see the forest for the trees. What that means is that all they can see is a stack of bills and are unable to see the bigger picture and a possible solution. Focus on organization by listing all debt and income on a piece of paper. After that, prioritize based on what has to be paid such as a mortgage and what is less important like a cable bill. Once you have a good idea of what you owe and to whom you can start making decisions on what to do next.
Many people don't like to hear this part because it means sacrifice but a crucial part of getting out of debt quickly is eliminating wasteful spending. Everyone has their guilty pleasure and unfortunately when overwhelmed with excessive debt that should be the first thing to go. Fancy coffee, cable-TV, eating out and Netflix are all examples of unnecessary expenditures which use up limited financial resources.
Once you determine what has to be paid and eliminate wasteful spending it is time to tackle the real issue of high-interest debt. Debt consolidation is a key tool for consumers who want to get out of debt quickly. It does two things that no other tool can do which are crucial when paying down debt. It allows consumers to take multiple high-interest rate debt, normally credit cards, and combined them into a single low interest rate and monthly payment. Ideally this would be done with a home equity line of credit or using balance transfer consolidation to a single low interest rate credit card. If these tools are unavailable, national nonprofit debt consolidation companies can also facilitate this type of debt consolidation.
If you don't have access to a home equity line of credit or a single high limit low interest rate credit card for balance transfers you can still negotiate your way out of debt. Many lenders, for fear of consumer default on unsecured credit, will work with borrowers to negotiate lower monthly payments and lower APRs. Some will go so far as to eliminate penalty fees and wave interest until the consumer gets back on their feet. It is important to contact lenders early in the process to inform them of your situation before you become delinquent. This proactive approach establishes a financially responsible pattern of behavior which lenders are more likely to work with.
Many consumers burdened with excessive debt will ask themselves what they can do to get out of debt quickly. The solution is a multipart process of consolidating debt, obtaining lower interest rates, eliminating wasteful spending and working with creditors to get back on track. There is no one single solution for how to get out of debt as it takes effort and dedication from a consumer for an extended period of time. Making debt elimination a priority is the only way to get back on track financially.
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