Published in Debt Advice Features on Tuesday, August 02 2005 by Ideal Debt Solutions
If you’ve suddenly discovered that you’re in debt and life seems pretty gloomy, don’t despair. Most people have been there and know just how easily it can creep up on us. Most of us try to ignore it until it becomes such a crisis that we go into panic mode and don’t know what to do.
If you’ve suddenly discovered that you’re in debt and life seems pretty gloomy, don’t despair. Most people have been there and know just how easily it can creep up on us. Most of us try to ignore it until it becomes such a crisis that we go into panic mode and don’t know what to do.
If you’re at the stage where you just don’t know where to turn to think of a close friend or family member who you trust and whose opinion you value. Make an opportunity to talk with them without being disturbed and tell them how you feel. Once you’ve spoken the words you’ll feel a huge sense of relief and their words should give you the confidence to take the next step.
When you’ve actually accepted that there’s a problem and the whole thing is out in the open it won’t seem so bad. The next move will be to contact whoever you owe the money. They will look on you far more favourably if you contact them rather than them having to contact you. Ask if you can delay or reduce the payment. This will probably mean that the length of the loan is extended but that’s something you’ll have to accept.
Make sure that you feel comfortable with the amounts that they’re suggested that you need to pay. If you over stretch yourself at the beginning there’ll be no way that you’ll be able to maintain the repayments and so you’ll annoy them even more. They’ll be happier with smaller payments as long as they’re made regularly.
All your problems will be documented and kept for anyone to see. This means that when you want credit in the future any new company will be able to immediately see that you’ve had a problem. We all have a credit rating and once it’s damaged it’s very difficult to put right.
If you’ve built up debts with a number of companies you can find someone who will consolidate them (put them together). As the debt will be larger it should be possible to negotiate a lower rate of interest and as it will be over a set period the repayments should be lower. Make sure that you’re happier with all the commitments that this new loan puts on you (they’ll be in very small print at the bottom of the paper work). If you have any doubts take the paper work to someone else and talk it over with them. Remember that this is over a fixed term and is just to pay off the debts that you already have. It’s not like a credit card where you can add new debts to the old.
Some companies may ask you to destroy your credit cards but even if they don’t it might not be a bad idea until you’re on your feet again. If you’re working with just cash you can’t be tempted to spend what you haven’t got!
Barry Layton is the editor and webmaster of “Debts Info” www.debtsinfo.com a premier debt and debt consolidation information site on the Internet. For more information following this article please pay a visit.