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  Category: Articles » Finance » Debt Consolidation » Article
 

Debt Negotiation Tips




By Robin James

Remember: Running away from your creditors is not the answer. It is not
a solution, and may in fact lead you to bigger problems. If you are having
trouble paying off your debts, address this immediately with your
creditors.

By accelerating the payment structure on your loan, the life of the loan is
reduced:

In a normal 30 year fixed rate loan situation, your monthly payment is
applied towards principle and interest. It is amortized over the course of
30 years.

In national accounting debts are added according to those who are
indebted. Household debt is the debt held by households. "National" or
Public debt is the debt held by the various governmental institutions
(federal government, states, cities ...). Business debt is the debt held by
businesses. Many credit card accounts come bundled with hidden fees
and high interest rates, accounts that many Americans have no hopes of
ever paying off.

Try These Debt Negotiation Tips

You may try debt negotiation with your creditors if you have realized that
you can't settle any due bills. In this way, you can find ways on how you
can find the needed money before creditors start calling you. Before
starting debt negotiations, you should be able to review and know what
bills you should pay first. Identify the payments that are nearing their due
dates. Then you can plan for your finances and determine how you can
subdivide your payments.

Many bank creditors are more than willing to negotiate with your financial
problems rather than passing your account statements to collection
agencies. They also don't prefer filing cases of bankruptcy against you. If
in case you come across of creditors who don't want to have debt
negotiations, make a communication plan that will allow yourself to take
steps on how you can settle all your debt problems. Here are some debt
negotiations tips that can help you arrange with your creditors.

1. You may request for agreements with your creditor to pay your bills in
installments or settle for a much lower cost. Make sure that you get a
copy of the agreement before making any payments. You might end up
realizing that your account is on a rolling late status. This means that you
will be given negative points on your credit report because you are only
settling your payments on a partial basis.

The Consumer Credit Counselling Service (CCCS) reports that calls from
people worried about debt have been increased by 50% compared with
last year. There are numerous groups, individuals, or products on the
market that are designed to help individuals dig their way out of and
recover from debt.

Although these products are available, there are still thousands of
individuals that choose not to receive assistance. It is true that some
individuals may be able to recover from debt on their own; however, it will
likely take a large amount of time and stress.

Make a Budget. If you want to have a grab of your financial situation
before you lose everything, making a budget is what you should do first.
Assess how much do you get from your income or other means and your
expenditures. For example, if getting that posh apartment means you
have to limit your meals to once a day, then it is not a great and sound
budgeting decision.

Find out how long it will take to become debt free and how much you'll
pay in interest by making the minimum monthly payments.

A home equity loan literally allows an individual to borrow from a lender
based on the amount of value they have earned on their home.

Debt is a hard thing to live with, reduce debts today! 2. You should also
be aware on those spreading scams on credit cards. You may find some
payment collectors that mislead payers on their credits and balances. It is
recommended that you become cautious on the people you transact
with. You shouldn't provide any personal information such as credit card
numbers, bank account numbers, or employment information.

3. One way to ensure the safety of your payments is to pay your debts
via certified mail. Make sure that you should also be provided with a return
receipt. You may request certified mail through a cashiers check or
through money orders. Remember to keep all receipts and documents.

4. It is recommended that you don't confirm any assurance that you can
pay your bills on time. You should exert an extra effort to notify your
creditor about your difficulties on settling your payments.

You may ask your creditor if they can provide you with new payment
terms. Never forget to inform your creditor about the changes in your
plan before making any payments. Most importantly, stick to the promises
that you will give your creditors to avoid future problems.

Another alternative is a Personal Loan or Debt Consolidation Loan. This is
one large loan to pay off smaller loans or debts. With one large loan, you
will normally have a lower percentage rate and a longer pay off period.

Get the best interest rate you can if you opt for debt consolidation. This
interest rate is almost as important as the one on your mortgage, but
much harder to change after you've signed on the dotted line.

The prospects of managing financial obligations have just gotten worse, as
Congress has passed legislation that will make bankruptcy filings more
difficult than ever.

The first step toward taking control of your financial situation, is to do a
realistic assessment of how much money you earn and how much money
you spend. Start by listing your income from all sources. Then, list your
"fixed" expenses ¡ª those that are the same each month ¡ª like mortgage
payments or rent, car payments, and insurance premiums.
 
 
About the Author
Credit card debts can mount up and get out of control quickly, you can reduce them today!

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