If you have multiple debts, and are struggling to meet the
monthly payments, then there's a good chance you will want to
consider, now or later, a consolidation loan to become debt
free.
If you have already studied your monthly expenditure and can
see no way to make savings, and find you have no way of earning
extra money, then your next option may be a free debt
consolidation loan.
By free, I mean no extra charges or arrangement fee for the
consolidation loan; your chances of getting an interest free
consolidation loan are just about zero, unless you have a rich
relative or friend. Should you go down the debt consolidation
route, try to avoid any loan arrangement which involves upfront
fees, or any extra fees at all for that matter. Whether that is
possible will depend on where you live, but in the UK, it is
not difficult to get a free debt consolidation loan.
One benefit of a consolidation loan is that it does give you a
chance to plan your finances in a way that could, if you're
careful, make you debt free by the end of the period of the
loan. By debt free, I will be realistic and mean "debt free
apart from home mortgage", which most people have little option
about, and mortgage debt can be worthwhile financially anyway.
Taking out a debt consolidation loan will not, of course, make
you instantly debt free. However, it may be that such a loan
will give you a chance to structure your finance plan over a 3,
5 or 7 year period. With the correct attitude and perseverance,
this may be an excellent opportunity to improve your finances
in the long term, resulting in being debt free by the end of
the loan period.
The consolidation loan will reduce your monthly outgoings, thus
giving you the opportunity to save. By getting into the saving
habit instead of debt habit, you will be able to set aside
money to pay cash for the things you need in the future; if you
are determined and disciplined, even that next car purchase can
be in cash, rather than an expensive loan. The result: you
become debt free.
In the financial reality of a consumer, if you cannot to afford
to pay cash for something, then you probably cannot really
afford it at all. The one exception is the house, where the
investment potential and rent saving change the financial
aspect.
Can you imagine, waking up at the end of the consolidation loan
term and finding yourself debt free? What a nice feeling!
About The Author: This debt consolidation article was written
by Roy Thomsitt, the owner and author of
http://www.eliminate-credit-card-debt-now.com/Consolidate_Debt.htm
Formerly a finance professional and credit controller, Roy is
now a full time online author.
Sunday, September 11, 2005
Legal Debt Collection Tricks
If a customer owes your local business money, it's hard not to
feel angry, like you want to do anything possible to get your
money back. But the days of going all out to collect on a debt
over.
The Fair Debt Collection Practices Act, designed to protect
consumers from harassment or intimidation, sets firm limits on
what you can do to collect a debt from a consumer. The federal
debt collections law even prohibits practices that were once
standard, and that you might not consider harassment at all.
Besides, as a local business, you have an even more powerful
reason to be especially careful about legal debt collection
issues. You have something much more valuable at stake than a
lawsuit: your business's reputation in the community.
Legal Debt Collection Best Practices:
There are plenty of articles on the web that lay out in plain
English what the Fair Debt Collections Practices Act says you
can and cannot do. Just to give you some idea of the law's
requirements, here are some of the biggest:
- No telling any third party about the debt (except collection
bureaus, collection agencies, or the debtor's attorney).
- No calling on the telephone 9 pm - 8 am, or calling
repeatedly in a way that is annoying.
- No postcards or envelopes that mention the debt.
- No threats to take actions you cannot or will not really
take, such as seizing property, in the case of an unsecured
debt.
- No misrepresenting yourself (e.g., "Hi! This is the
Publisher's Clearinghouse Sweepstakes. May I speak to John?").
- No paying down the debt with payments the customer has
directed be applied to other debts
Tips and Tricks for Legal Debt Collections:
With all these limits on what you can do to collect a debt,
what can you do legally?
- Speak with the debtor personally on the telephone; most
likely he or she wants to pay but is in over his or her head.
Begin by asking what circumstance has kept him or her from
paying. Offer to set up a repayment plan.
- You should both send letters and make telephone calls. Many
people will only respond to one or the other.
- Document every part of the collections process. Take notes
for each call and keep a copy of each letter. If the debt does
ever go to court, you will have proof you acted legally.
- Look into reporting the debt to credit bureaus. If you can,
and are willing to do it, you can tell the debtor that not
paying will impact his credit rating.
- Best tip of all: hand over the job to a dedicated collection
agency. Small business debt collection services start at as
little as $20 per debt. The fight to get paid is a fight no
business should have to involve itself in.
Unfortunately, debt collections are a part of business. Just
make sure that for your local business debt collection law is
followed to the letter, or legal proceedings may become part of
your business, too.
About The Author: Free debt collection laws information at
http://www.debt-collection-laws.com/
feel angry, like you want to do anything possible to get your
money back. But the days of going all out to collect on a debt
over.
The Fair Debt Collection Practices Act, designed to protect
consumers from harassment or intimidation, sets firm limits on
what you can do to collect a debt from a consumer. The federal
debt collections law even prohibits practices that were once
standard, and that you might not consider harassment at all.
Besides, as a local business, you have an even more powerful
reason to be especially careful about legal debt collection
issues. You have something much more valuable at stake than a
lawsuit: your business's reputation in the community.
Legal Debt Collection Best Practices:
There are plenty of articles on the web that lay out in plain
English what the Fair Debt Collections Practices Act says you
can and cannot do. Just to give you some idea of the law's
requirements, here are some of the biggest:
- No telling any third party about the debt (except collection
bureaus, collection agencies, or the debtor's attorney).
- No calling on the telephone 9 pm - 8 am, or calling
repeatedly in a way that is annoying.
- No postcards or envelopes that mention the debt.
- No threats to take actions you cannot or will not really
take, such as seizing property, in the case of an unsecured
debt.
- No misrepresenting yourself (e.g., "Hi! This is the
Publisher's Clearinghouse Sweepstakes. May I speak to John?").
- No paying down the debt with payments the customer has
directed be applied to other debts
Tips and Tricks for Legal Debt Collections:
With all these limits on what you can do to collect a debt,
what can you do legally?
- Speak with the debtor personally on the telephone; most
likely he or she wants to pay but is in over his or her head.
Begin by asking what circumstance has kept him or her from
paying. Offer to set up a repayment plan.
- You should both send letters and make telephone calls. Many
people will only respond to one or the other.
- Document every part of the collections process. Take notes
for each call and keep a copy of each letter. If the debt does
ever go to court, you will have proof you acted legally.
- Look into reporting the debt to credit bureaus. If you can,
and are willing to do it, you can tell the debtor that not
paying will impact his credit rating.
- Best tip of all: hand over the job to a dedicated collection
agency. Small business debt collection services start at as
little as $20 per debt. The fight to get paid is a fight no
business should have to involve itself in.
Unfortunately, debt collections are a part of business. Just
make sure that for your local business debt collection law is
followed to the letter, or legal proceedings may become part of
your business, too.
About The Author: Free debt collection laws information at
http://www.debt-collection-laws.com/
Saturday, September 10, 2005
Debt Elimination 3
Planning To Achieve Debt Elimination
Once you have started the process of changing your debt mindset
to be against taking on consumer debt, then that is something
you need to continue until it becomes the norm in your life. In
some ways it is like stopping smoking; trying on will power
alone is not enough, you need to get to the source of your
problem and permanently change it. That is why self hypnosis
can be successful with stopping smoking; it reaches the
subconscious mind and re-educates it. With debt elimination, it
is the same; to succeed permanently you need to have changed the
way your mind works, not just consciously, but sub consciously
too.
In parallel to changing your mindset, you need to plan your
debt elimination strategy. This will depend on you precise
financial situation: your level of debt, monthly income,
monthly commitments, overdue debts and so on. So, I cannot make
specific suggestions for your circumstances, just give a few
pointers to what you can do to head down the road to debt
elimination. You may well get some benefit from debt counseling
or financial planning advice at this stage, but that depends on
you.
Your chances of achieving debt elimination within, say, 5
years, will depend a great deal on your own efforts, so if you
can get through this part alone, then that may strengthen your
chances of success.
Budgeting For Debt Elimination
You need to take a long hard look at your present financial
situation and how it is likely to evolve into the future. For
debt elimination to succeed, you need to be in control of your
finances and keep your finger on the pulse all the time.
The starting point should be a list of your monthly outgoings.
If you are unsure of any item, then monitor it for a month to
see. For example, you may not know exactly how much you spend
on food and other items from the grocery stores each month.
Just keep a record of them for a month to see what your monthly
expenditure is, but in the meantime use your best estimate.
You can then compare your monthly outgoings with your net
income, and this will be the basis of your budget as you
develop a plan for debt elimination. You also need to compile a
list of your debts; how much is outstanding, what the monthly
payments are, and what the interest rate is.
As an example, let us say you have a net monthly income of
$2500, and your total outgoings, including debt and credit card
repayments, are $2300. This means you have $200 to spare. With
your new, anti debt mindset, you want to use that $200 spare to
get your most expensive debts cleared first. There is a good
chance it is the credit cards that are most expensive, so you
can target the most expensive credit card ie the one with the
highest interest. You owe $600 on that card, so in 3 months you
can clear it. When cleared, you can move on to the next most
expensive.
Depending on your debt level this could be a long process;
that's why you need to plan it out and see how you will cut
down that outstanding debt level over the coming months and
years. So long as the total debt level is reducing, you are
heading in the right direction.
Also, take a close look at those monthly outgoings. Are you
sure there's nothing that can be cut out or reduced? Of course
there is, unless you've already gone through that process
recently. Be ruthless with this new mindset of yours; it really
is worthwhile, knowing there will come a day when you don't have
to worry about the odd few dollars here and there. Highlight
those budget items that are unavoidable, and make sure you pay
those first every month, or at least have the money earmarked.
If you rank your debts in order of interest rate cost, and go
for the highest first, you can work through them one by one.
Need a morale boost to get you off to a good start? Then choose
the loan with the least outstanding, and clear that first. It
may not be the best financially, but if it gives you that quick
satisfaction, so the sacrifice may be worth it.
Debt elimination is not going to be an overnight happening. You
need to be prepared to plan for a few years. 5 years is always a
good period to plan for in business, and can be too in your
personal life and finances. You may be amazed at the
transformations you can achieve in 5 years. But above all, you
need to maintain that anti debt mindset. After all, that is
what will bring you to the debt elimination pinnacle.
In the next article, we consider what to do if there is really
no spare in your monthly budget.
About The Author: Roy Thomsitt is the owner and part author of
http://www.eliminate-credit-card-debt-now.com
end article.
Learn How To Get Out Of Debt, Using Only The Money You Already Earn And Not A Penny More! Learn how to put all the money you're wasting each and every month (Paying Interest) To Work for You!
Click Here For: Total Debt Elimination!
Once you have started the process of changing your debt mindset
to be against taking on consumer debt, then that is something
you need to continue until it becomes the norm in your life. In
some ways it is like stopping smoking; trying on will power
alone is not enough, you need to get to the source of your
problem and permanently change it. That is why self hypnosis
can be successful with stopping smoking; it reaches the
subconscious mind and re-educates it. With debt elimination, it
is the same; to succeed permanently you need to have changed the
way your mind works, not just consciously, but sub consciously
too.
In parallel to changing your mindset, you need to plan your
debt elimination strategy. This will depend on you precise
financial situation: your level of debt, monthly income,
monthly commitments, overdue debts and so on. So, I cannot make
specific suggestions for your circumstances, just give a few
pointers to what you can do to head down the road to debt
elimination. You may well get some benefit from debt counseling
or financial planning advice at this stage, but that depends on
you.
Your chances of achieving debt elimination within, say, 5
years, will depend a great deal on your own efforts, so if you
can get through this part alone, then that may strengthen your
chances of success.
Budgeting For Debt Elimination
You need to take a long hard look at your present financial
situation and how it is likely to evolve into the future. For
debt elimination to succeed, you need to be in control of your
finances and keep your finger on the pulse all the time.
The starting point should be a list of your monthly outgoings.
If you are unsure of any item, then monitor it for a month to
see. For example, you may not know exactly how much you spend
on food and other items from the grocery stores each month.
Just keep a record of them for a month to see what your monthly
expenditure is, but in the meantime use your best estimate.
You can then compare your monthly outgoings with your net
income, and this will be the basis of your budget as you
develop a plan for debt elimination. You also need to compile a
list of your debts; how much is outstanding, what the monthly
payments are, and what the interest rate is.
As an example, let us say you have a net monthly income of
$2500, and your total outgoings, including debt and credit card
repayments, are $2300. This means you have $200 to spare. With
your new, anti debt mindset, you want to use that $200 spare to
get your most expensive debts cleared first. There is a good
chance it is the credit cards that are most expensive, so you
can target the most expensive credit card ie the one with the
highest interest. You owe $600 on that card, so in 3 months you
can clear it. When cleared, you can move on to the next most
expensive.
Depending on your debt level this could be a long process;
that's why you need to plan it out and see how you will cut
down that outstanding debt level over the coming months and
years. So long as the total debt level is reducing, you are
heading in the right direction.
Also, take a close look at those monthly outgoings. Are you
sure there's nothing that can be cut out or reduced? Of course
there is, unless you've already gone through that process
recently. Be ruthless with this new mindset of yours; it really
is worthwhile, knowing there will come a day when you don't have
to worry about the odd few dollars here and there. Highlight
those budget items that are unavoidable, and make sure you pay
those first every month, or at least have the money earmarked.
If you rank your debts in order of interest rate cost, and go
for the highest first, you can work through them one by one.
Need a morale boost to get you off to a good start? Then choose
the loan with the least outstanding, and clear that first. It
may not be the best financially, but if it gives you that quick
satisfaction, so the sacrifice may be worth it.
Debt elimination is not going to be an overnight happening. You
need to be prepared to plan for a few years. 5 years is always a
good period to plan for in business, and can be too in your
personal life and finances. You may be amazed at the
transformations you can achieve in 5 years. But above all, you
need to maintain that anti debt mindset. After all, that is
what will bring you to the debt elimination pinnacle.
In the next article, we consider what to do if there is really
no spare in your monthly budget.
About The Author: Roy Thomsitt is the owner and part author of
http://www.eliminate-credit-card-debt-now.com
end article.
Learn How To Get Out Of Debt, Using Only The Money You Already Earn And Not A Penny More! Learn how to put all the money you're wasting each and every month (Paying Interest) To Work for You!
Click Here For: Total Debt Elimination!
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