Hello, everyone! What should someone do that's has a significant amount of debt? I know about the usual channels such as transferring balances to a 0% interest credit card, calling the credit card companies to have the interest rates lowered, etc. This is a significant amount and I don't know much about the debt consolidation companies, etc. I've done a TON of research online but I'm not convinced that all the info is accurate. Any advice in reference to tricks of the trade, or things to watch out for would be appreciated. Thx so much for your time!
Personal Debt Issue...What Can Be Done?
- Thread starter 1blkc5
- Start date
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- Dec 4, 2021
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- 746
Cut expenses, increase income, pay it off using the "snowball" method. It requires great discipline and balancing of interests.
For some, bankruptcy is the answer. Large medical debt and small income, for instance.
Stay away from debt consolidation companies, they don't have any magic wand.
For some, bankruptcy is the answer. Large medical debt and small income, for instance.
Stay away from debt consolidation companies, they don't have any magic wand.
I know many will bash the increase income approach. There's a number of jobs out there that one can take on without experience that require something such as weird hours, physical labor, and a work ethic. For example a railroad job can put you at 6 figures without special education.
For unsecured debts (such as credit cards), one can either try himself to negotiate with the card company to reduce interest rates and balances for quick payoffs (they would rather have 50%, even 30%, if they suspect they might get nothing). For secured debts like car loans, surrendering them is an option. Expect to take hits to credit that will last many years.
There's also professional debt consolidation services, but be cautious on scams. Bankruptcy is a serious option that requires a experienced professional but if it's massive debts that cannot be repaid, then debt reorganization thru bankruptcy is a option.
There's also professional debt consolidation services, but be cautious on scams. Bankruptcy is a serious option that requires a experienced professional but if it's massive debts that cannot be repaid, then debt reorganization thru bankruptcy is a option.
Agree with the idea of cutting ALL unnecessary expenses, sell everything not necessary, get a 2nd and 3rd job, aggressively pay off debts.
This is hard to answer, not knowing the debt to your income, the interest rate. Your age, time to retirement, your savings ,401 etc.
But eliminate all unnecessary costs, cable tv, beer, new car payments etc.
Is it one debt or several different debts?
Is the debt tied to a house or car?
REMEMBER!!!!! You cannot borrow your way out of debt, you aren't the gubment.
But eliminate all unnecessary costs, cable tv, beer, new car payments etc.
Is it one debt or several different debts?
Is the debt tied to a house or car?
REMEMBER!!!!! You cannot borrow your way out of debt, you aren't the gubment.
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Look up Call Dave Ramsey
Someone once told me, "The 1st thing you should do, when you find yourself in a hole, is to stop digging."
Beyond that, is there anyone in your family or friends who is financially sound? Can they help?
If you want to pay it off, here's some tactics:
Get rid of the higher interest rate loans first, as they are the most expensive.
Can you cut loose (sell) anything?
Invest in yourself; such as further your education, get a better job and improve your spending habits.
Good luck.
Beyond that, is there anyone in your family or friends who is financially sound? Can they help?
If you want to pay it off, here's some tactics:
Get rid of the higher interest rate loans first, as they are the most expensive.
Can you cut loose (sell) anything?
Invest in yourself; such as further your education, get a better job and improve your spending habits.
Good luck.
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Beer? Let's not go too far man!
Seriously though, giving up the habits that get us into debt if it is self induced is the biggest fix for the issue. I used to be horrible about wanting the latest, greatest thing on the market. Luckily I figured out this wasn't doing me any good at some point and managed to increase my income after that. I think if I hadn't come to that realization until after I got a better paying job I could have done a lot more damage.
That works every time!
There was a point in my life where I had to change everything and learn everything because my best shot got me into a pretty dark place. At the end of my rope... Simple advice like this, from persons who knew where I was coming from, saved my a....
Contact a bankruptcy attorney.
@1blkc5 The quote above is from from a member who dug himself out of a hole. You can find his story in his previous posts, it's quite inspiring. Yes, it can be done and it takes work to get there, but you'll be glad you did it.
dnewton3
Staff member
Most of the above are all reasonable suggestions.
I do, however, have great concern that you're asking a bunch of strangers on the web about serious financial advice regarding debt restructuring, and now some are asking you personal details about income, type of debt, and even potential bankruptcy. This is where paid professionals should be engaged. The fact that you're in this position in the first place, and you're asking people for internet advice, does not bode well.
TREAD CAUTIOUSLY!
I do, however, have great concern that you're asking a bunch of strangers on the web about serious financial advice regarding debt restructuring, and now some are asking you personal details about income, type of debt, and even potential bankruptcy. This is where paid professionals should be engaged. The fact that you're in this position in the first place, and you're asking people for internet advice, does not bode well.
TREAD CAUTIOUSLY!
I agree with others; stay away from debt consolidation companies because it’s pretty much a scam. Working directly with the creditors is your best bet. Unfortunately, you have to be a few months behind in your payments before they become more reconciliatory. They will typically offer you a settlement amount that’s generally 55-60% of the balance. Be careful to except that carrot because the portion they eat, will be counted as reportable income to you. Offer to make token payments where they will forfeit interest in many cases. You can get by making $100 +/- or so monthly payments, and that’s generally acceptable. Once you arrange your budget to match, you should target the smaller accounts first, and so on.
If you’re unable to work any of this out, ask if they have a ‘hardship policy’ and see if they’ll give you a 12-month suspension of payments. This will give you time to come up with plans B,C, and D.
If you’re unable to work any of this out, ask if they have a ‘hardship policy’ and see if they’ll give you a 12-month suspension of payments. This will give you time to come up with plans B,C, and D.
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I appreciate the kind words. All I can tell you is, if we are painstaking about our development, we will be amazed before we are halfway there.
If the path wasn't better, far better, we wouldn't continue.
That's my experience.
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