How To Adopt  Guide To Getting Debt Relief Fast

Carrying balances on multiple credit cards is stressful and expensive, and paying them off quickly can be a challenge. That’s especially true if you are living paycheck-to-paycheck or dealing with other debts simultaneously, like student loans. But it is possible to get debt relief even with those challenges.

This 5 Step guide can help you develop a plan to pay off your debt or identify the best debt relief option when a traditional payoff plan just won’t cut it.

Step 1: Stop making it so difficult to get debt relief Before we get into how to set up the right plan to get out of debt, we need to touch on one of the biggest mistakes people make when they need debt relief— they keep spending on credit cards while trying to pay them off.

Step 2: Create a budget that’s optimized for getting out of debt

A budget is essential in your quest to get out of debt, no matter which debt relief option you end up using. You need to get a budget in place

Step 3: Take stock of your debts and decide on a repayment strategy Gather up your most recent credit card statements or login into your apps to write down the following for each credit card: 1. Current balance 2. Current monthly payment 3. APR (interest rate) 4. Status of the account (current, behind, charged-off)

Step 4: Set up a debt reduction plan

This is where your budget comes in because minimum payments aren’t going to help you get out of debt quickly. Instead, you need to put as much money as possible towards paying off one debt at a time.

Step 5: Explore options for debt relief

Let’s go over the most popular forms of debt relief and the best situation to use each one. These solutions can help you avoid bankruptcy and get out of debt as quickly as possible. The first two solutions are do-it-yourself debt relief options. The second two are debt relief programs that you set up with professional help.

Credit card balance transfer

This strategy works best if you have large sums of free cash flow to make the largest payments possible. You also need excellent credit to qualify for the longest 0% APR period possible.

Debt consolidation loans

A personal debt consolidation loan can be a great option for debt relief if you have good credit and a stable budget. You get a personal loan in an amount equal to your total credit card debt.

Credit counseling and debt management plans

The credit counselors work with the creditors to reduce or eliminate interest and stop penalties from applying to your account. That makes it easier to pay off each balance. And since you’re working with the credit counseling service, creditors will agree even if you have bad credit or your accounts are behind.

There is one type of debt relief program that can have tax consequences—a debt settlement program. If you settle a debt for less than the amount you owe, you may be required to pay taxes on the percentage that you didn’t pay.

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