The rich rule over the poor, and the borrower is slave to the lender.
More than anything else, as an individual who desires to set aside money for emergencies, for vacations, or for future special plans, you need to face the realities about your outstanding debts, and other related obligations. Well, if you do not have any, lucky you.
On the other hand, it is a requisite to deal with them especially if they are beginning to pile up. Specific methods are all over the internet to get out of debt, and some of them are laced with the word quickly. It is important, however, that you need to learn some truths about debts.
1.You cannot delay payment.
As soon as you realize that your debts are piling and they are causing you stress and everything related to it, and that you are not able to save even a little money for future plans, you need to sit down and face the situation. You need to have a plan and it always starts with a list of all the debts, or obligations you have, from the smallest to the largest. Some recommends paying off the largest debts (Avalanche) but the other suggestion of starting to pay the smallest ones first is sounder because it gives you that feeling of accomplishment (Snowball). These two methods are the snowball and avalanche methods.
2.Your current situation does not guarantee non-payment of or amnesty from your debt.
Even if you are faced with a current situation like having a newborn baby in the family, or had had an accident or a declining health, or had lost your job, you are required to pay your debts. Your creditor does not care about your situation, he only cares for your payment. An adverse situation may or may not assure an amnesty but definitely will not guarantee non-payment. Best thing is to talk to your creditor and ask for considerations or lower interests or longer payment terms.
3.You cannot fund your lifestyle with debts.
Even if you easily passed the requirements to acquire loans using credit cards, or any other tool, you cannot acquire a new car, or a high-end gadget, or anything that is not that necessary, with a current situation where you have remaining debts to pay. Be sensitive enough to pay your creditors first than funding your lifestyle. This is the most common why creditors are so angry with his debtor. They tend to live a lavish style instead of paying their debts firsts.
4.You do not benefit from paying the minimum payment.
Unless faced with the strictest situation, work on paying more than the minimum payment. Not only will it finish your payment the soonest possible time but will also trim down the extra charges incurred. Pay more than the minimum. It will save you more time and money in the long run. Pay now and enjoy later.
5.You do not need to bear high interests if you have a way out.
There is always a way to lower the interests of your current debts, or loans. Do not run from your creditors and negotiate your loans’ interests when you decide to be assertive in paying your debts. It’s only a call away. Lenders will delight at the idea to that you are interested to make payments and that you are not running away from them. Be yourself, be honest, have plans to pay your debts and present it to them.
6.You do not need to stay with a lender that does not negotiate.
There is always good news if negotiation is an option but if a lender will not hear your repeated appeals, then a balance transfer is the best option. There a lot of introductory offers from different lenders. Grab that opportunity when a lender offers zero interests for months. Many credit card companies offer this type of zero interest balance transfer. Make sure you study each creditor’s term and if possible, transfer all your debts in the creditor that can give you the best term. It will save you time, effort and money.
It is not easy to be put in a situation with a pile of debts. Confronting the realities that goes with it will not only help in accepting the fact that you are in deep trouble, but will prepare you in solving it in the best way available.
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