Types of debt consolidation loans and the best places to find it in 2020

Debt consolidation loans are primarily used to pay off and simplify existing debts. You may consolidate multiple debt payments and credit accounts into a single account with a single lender and one easy payment.

Considering your creditworthiness, you might be offered lower interest rates from lenders. The interest offered should be lower than your existing interest. This way you can save money on monthly payments by cutting off the overall interest payment.

Another way to reduce your monthly payment is by extending your loan tenure. However, with a long loan term, you might end up paying more interest in total.

Typically, a debt consolidation loan can be used to consolidate unsecured debts. Common types of debt that can be handled through debt consolidation are

  • Credit card debts
  • Medical bills
  • High-interest personal loans
  • High-interest payday loans

Now let’s check out the different types of debt consolidation loans available for you

1. Personal loans

Taking out a personal loan to consolidate unsecured debts is the prime object of a debt consolidation loan. If you can borrow a big loan with a low-interest rate, you can use that money to pay off all the debts easily and save on interest payments. Multiple high-interest debts may cost you more on interest payments than one big personal loan with a low interest rate.

A personal loan is typically one of the most common types of debt consolidation loans. It is an unsecured loan where you need to make fixed monthly payments over a certain period.

Your credit score plays a crucial part when you want to get approved for a personal debt consolidation loan. If you carry an average credit score, you might get approved, but with a higher interest rate. You may not get approved at all if you have a bad credit score.

It is not wise to opt for a high-interest personal loan; because in the long run, you won’t be able to afford the monthly payments. Due to the high monthly payment, you might face difficulties to carry it till the end. So, you should research well and choose a personal loan that you can afford to pay throughout the loan term.

Once you’re approved for a suitable personal loan, you can use it to consolidate all your unsecured debts easily.

2. Balance transfer on credit cards

The balance transfer method is one of the most common strategies of a debt consolidation process. By using the credit card balance transfer method, you may transfer your unpaid credit card balances into one or several credit cards. , you should find a 0% APR balance transfer card (offered by credit card companies) to transfer your balances. However, you should make sure you choose a card that has a zero transfer fee, and 0% APR applied also on the new purchases made by that card. Stay focused and pay off the balances before the promotional rates expire, typically within 6 to 12 months.

Keep tracking the interest rates if you want to use a balance transfer credit card as a debt consolidation loan. After the 0% introductory period, the interest rate might increase and become very expensive; so act accordingly. Also, you’ll need a big credit limit, enough to transfer all of your other credit card balances.

You should also consider the drawbacks of consolidating credit debts with the balance transfer method. First of all, you can only consolidate your bills that you have paid through credit cards. Secondly, transferring your credit balances may hit your credit score. If you use too much of your available balance on one credit card, it might harm your credit score, as it will increase your overall credit utilization. But you may normalize your credit score once you pay off all the balance.

3. Home equity loans

A home equity loan is also considered as one of the different types of debt consolidation loans.
You may take out a home equity loan by using your existing home equity as collateral. The word equity stands for the market value of your house minus your outstanding mortgage loan. To get a home equity loan you must have a good amount of home equity in your pocket and a good credit score.

A home equity loan offers a lower interest rate than other types of loans. But one major drawback you should not ignore about home equity loans. You are deliberately using your home as collateral and taking out money to pay off unsecured debts. Practically that means you will be converting your unsecured debts into secured debts (with collateral) through the entire debt consolidation process. If you can’t afford the payments, you’ll be facing foreclosure on your property. So, normally it’s not wise to pick up a home equity loan to consolidate unsecured debts.

4. A loan taken out from family or friends

If you decide to borrow money from a friend or relative, it can be a safer option to consolidate your unsecured debts. You can get a debt consolidation loan from them, and you may not have to worry about interest payments at all.

If you have a good relationship with your family and friends, they might give you more than enough time to repay the money. Compared to the commercial lenders, they sometimes even spare you the interest. But in most cases, your friend or relatives may charge a lower interest rate compared to a bank. So, this type of loan is quite affordable for debt consolidation and easy to repay with time. Also, your friend or relative might be less strict if you miss one or two payments.

There is a catch if you ignore paying off the loan to your relatives or friends. If you fail to make monthly payments or to repay the entire loan, as a result your relationship with the friend or relative would be at stake. For that reason, you should think twice about getting a debt consolidation loan from someone close to you.

If you still need to borrow money from a friend or relative, make sure you get the loan agreement in writing, just as you do with a bank. The written agreement will be signed by both parties, you and your friend/relative. The agreement should include each detail of the loan in the agreement. You need to meet the deadline for paying off the loan every month. As there are no penalty charges or late fees associated with that loan, you must pay off the entire balance as per the agreement and within the time frame.

The best debt consolidation loan companies of 2020

These are the most popular companies which may provide you different types of debt consolidation loans as per your specific financial situations:

  • Discover – Best Lender with no fees except late fees
  • LightStream – Best Lender for funds in a day
  • Avant – Best Loans for Average Credit
  • Marcus by Goldman Sachs – Best Lender for Customer Service
  • Prosper – Best Lender for loan for $2,000 or more
  • SoFi – Best Lender for Overall loan service
  • Upstart – Best Lender for Borrowers With FICO Scores As Low As 620
  • OneMain – Best Debt Consolidation Loans
  • Earnin – Best Personal Loan Alternative

Data courtesy – usnews.com

U.S. News examined all the top lenders and lending partners who deal with personal loans for debt consolidation purposes. The research reveals each lending company’s prime eligibility criteria. They are as follows:

  • credit score requirements,
  • loan terms,
  • additional fees,
  • repayment options,
  • additional benefits/limitations.

Each borrower has different requirements while choosing the best debt consolidation loan. So, as a borrower you should keep these in mind. This way you may find the best-fit loan provider, as per your specific credit background and requirements.

How to build a debt collection defense against possible lawsuit

You might face a collection lawsuit when a creditor files a lawsuit with the court against you. A debt collection lawsuit can take time and can be expensive. Most creditors do not want to choose this option while collecting old debts. Creditors will always go for other available options.

In most cases, creditors prefer to repossess your assets like cars, home or other precious things. A debt collection lawsuit is rarely issued for debts under $1,000.

There are collection agencies that may aggressively threaten consumers to garnish employee wages to collect debts. However, the creditor or collection agency cannot garnish your wages without a proper court judgment. But still, debtors might face collection harassment from the very beginning of the collection process.

If a collection agency filed a lawsuit against you, do not panic and prepare your next steps to deal with this issue. You may follow the below-given strategies to create a debt collection defense and win a debt collection lawsuit.

1. Give proper response to the lawsuit

Being a consumer, if you do not respond to the debt collection notice, it will be a grave mistake. This notice normally comes as a summons and complaint. If you have debts and can’t pay it, the creditor may file a lawsuit as a last resort.

If you do not attend the summon, the collection agency might get a default judgment against you. Through this, they may be able to garnish your wages and get money from your bank account. As per the collection law in different states, the debt collector may even collect their attorney’s fees, court costs, or interest from your wages.

So, when the plaintiff (the creditor or collection agency) files a lawsuit, you can’t contact the plaintiff via Email or phone. You must reply to the lawsuit via legal briefs called an Answer . This is how you should do it:

  • Do not accept the debt at first glance. Ask the creditor to validate the debt first.
  • File your Answer with the clerk of court.
  • Get your stamped copy of the Answer from the court.
  • Send that stamped copy via certified mail to the plaintiff.

You should send your Answer within the stipulated time as per the lawsuit summons. The given time may vary from 20 to 30 days from the date on the notice. Do not miss the deadline at all. As per the Consumer Financial Protection Bureau (CFPB), once a judgment is given, you can’t dispute the debt from that point on.

2. Challenge the debt lawsuit

You may challenge Plaintiff’s right to file a lawsuit against you. Collection agencies normally purchase your debts at a lower value from the creditors and get a transfer of the signed debt agreement. Through this, they establish the right to collect this debt and initiate collection harassment. But here is the catch. Normally 99.9% of debt cases are not properly transferred to the collection agency through a proper agreement signed by the creditor.

So, you may request the court to dismiss the case as the Plaintiff does not possess the “chain of custody” documents. If the court finds out that debt collectors do not have the required “chain of custody” documents, they may dismiss the case.

3. Check the statute of limitations

Sometimes, debt accounts may take too much time to get transferred from the original creditor to the collection agency. So, it will also take long to start the debt collection lawsuit process. Each state has a different statute of limitations for debts. That means in every state there are different times allotted to file a lawsuit. If the debt collector exceeds the statute of limitations period, the consumer may request the court to dismiss the lawsuit.

However, the statute of limitations clock may start again if you start making payments on an old debt.

4. Hire a good attorney

One of the best ways to create a debt collection defense is consulting a good attorney. He/she will help you choose the best options in defending against a debt collection lawsuit and raise any applicable defenses to the claim. You may get free consultations from many attorneys regarding your issue.

A good attorney may help you to:

  • Know if you have any options left and which one is the best.
  • Check if you are getting equal benefits compared to the legal costs.
  • Provide a helpful view of your case as a third party

If you have a strong case, your attorney may deal with your case without fees. It is because there might be a possibility that the court may order the creditor or collection agency to pay all legal fees including the fees of your attorney.

5. Take legal action against the plaintiff

If you have solid proof that your debt collector has violated the laws of debt collection, as per the Fair Debt Collection Practices Act (FDCPA), you may be able to take strict legal actions against the debt collector. You may successfully sue them for violating the debt collections practices act and get statutory damage charges of $1,000, plus other monetary losses.

6. File a petition of bankruptcy

Devastated with the collection harassment, If you can’t pay off your debts and there’s nothing you can do to improve your financial situation, filing for bankruptcy might be the only option. When you file a petition of bankruptcy, it will initiate an automatic stay which will stop all debt collection activities from that moment.

You must talk to your lawyer first before choosing a Chapter 7 or Chapter 13 bankruptcy. If you want to wait until you get a summons, just before the date of the hearing, your attorney might have to file an emergency bankruptcy petition to save you. But that would be more expensive.


There are multiple options to create a debt collection defense against possible lawsuits. Just remember that you should be honest with yourself and with your attorney. Only then your lawyer may help you to get yourself out of this misery. Good luck.

Beat money depression with 7 amazing tips

When you face downfall due to money problems, it can be dangerous for your mental health, physical health, and even for your family. But listening to this might give you peace of mind that you aren’t alone.

If you’re depressed about money and want to turn the table with a positive approach, here are some options to brighten your mind.

1. Review the past

If you are depressed with your finances, a good first step might be reviewing your past. Look at your past income flow and how much you have spent. Review how much you have borrowed and how much you still owe to creditors. Evaluate your assets and check if they are still worthy to be called assets or they have now become a liability.

You need to find the issue if you want to beat money depression. Most of the time, people become depressed because they can’t find the real issue that causes depression. A change of perspective may solve your problem. It might happen that the financial issue you’re facing might be totally out of your hands. For example, financial downfall during the economic recession.

2. Stay active like other happy people

It is the easiest way of recovering from money depression as per my knowledge. Instead of being depressed, keep yourself active. Go out with friends, do whatever you want to do. This might help you to distract yourself from the problems.

Doing this constantly can make you happy. It’s called the ‘fake-it-till-you-make-it approach’ for fighting money depression.

Keep yourself away from alcohol and drugs. You need sufficient sleep at night, but too much sleeping is also harmful for you. If you sleep more than 7 hours a day, try to wake up early. Do exercises regularly and drink lots of water. It will increase positivity in your body and mind. Initially you’ll find it difficult to cope up with these habits, but soon you’ll get positive results and start recovering from money depression.

3. Take the required actions

You’ll have to decide what your next step will be. To handle money depression, would you increase your income? Retirees might consider the idea of generating income, less spending, and more saving once again. You can try whatever you like, to start paying off some of your debts.

One practical step to deal with money depression is reviewing your monthly bills. Checking your monthly bills may give you the purpose of what you must take care of in the first place.

Trust me, paying off your debts, no matter how small it is, can make you feel relieved and happy.

4. Volunteer yourself to charity

Barbara Neitlich, a licensed clinical social worker and psychotherapist working in Los Angeles suggested, “The act of volunteering or helping someone actually has a chemical effect on the brain and will often raise your spirits.”

Research reveals, people who volunteered weekly of charities, were 16% more likely to be “very happy.”

Through volunteering, you can meet new people and make new connections.

Lisa Kindel, a multimedia freelance consultant in Frankfort, Kentucky, explained, “When I’m feeling insecure, unsuccessful, I go sit at the info desk at my local farmers market to talk about local foods, produce, weather, recipes… Talking to other people about food and recipes can pick me up because I’m not dwelling on what’s wrong with me that day.”

5. Focus on controlling your budget

You should be focusing on maintaining your current budget plan. Free websites like mint.com might come in handy to assess your income and expenses. Prepare a plan to beat your money depression. Improve your finances by maintaining a solid budget. You must also seek out new income streams.

Brad Klontz, PsyD, a financial psychologist based in Hawaii has explained, “Do an honest assessment of what you need because there’s very little correlation between things and happiness.”

6. Get mortgage counseling

In 2010, about 2.9 million U.S. homeowners got foreclosure notices. Make sure you do not become a part of a similar record in 2020.

If you’re behind on your mortgage payments, seek free help from mortgage counselors approved by the Department of Housing and Urban Development (HUD). Craig E. Pollack, MD, assistant professor of medicine at Johns Hopkins University, in Baltimore, also suggests the same.

7. Create a temporary plan and deal with money depression

Practically, you need to find out how you will make payments of your bills and handle finances while dealing with money depression. If you are broke and have no income, you may consider taking a job to earn dollars.

If you can’t engage yourself in a job, then you may ask help from your family to lend you funds. This way you won’t have to worry about the interest. You may even opt for a low-interest personal loan. You may even take out a loan from 401(k). But try to avoid it considering your retirement funds.

If you are still having financial issues like debt (credit card bill, payday loans, etc.) and can’t find a way out, take help from professionals in the industry.


“One reason people can find themselves down about money problems is that they don’t know how to solve them.” – Colin Drake, entrepreneur, California.

You may take help from a financial planner as per your affordability. You might also need a therapist. Your health insurance does not cover any illness due to your money depression.
Talk to your friend or a family member. If you’re truly financially depressed, your dear ones may join you in fighting with money depression.

How to save money through 6 budget-friendly hacks on daily items

One of the best ways to reach your financial goals is to learn how to save more money and maintain your budget. The more you can save, the more quickly you will be able to reach your financial goals. Your prime goals should be paying off debt, saving for retirement, buying your first home, building your investment portfolio, etc.

Most of us normally focus on bulk saving. It is like saving through working extra, or saving on shopping, or buying through cash instead of using credit cash. But, have you ever thought of saving on the everyday items that you use daily? What daily items? I am going to tell you a few such budget-friendly money saving hacks that you may apply daily, and save more money.

1. Remove water stains

The issue: You might have seen that your fancy coasters and your beautiful wooden table are getting multiple white rings or water stains whenever you drink any beverages like soda, beer, or juice. If you quickly wipe the surface, the stains might get removed. But if you do not… it will leave a sticky, nasty mark which might catch germs. Cleaning is also not easy. You might need a good quality, expensive surface cleaner, and a good dishwashing solution to do the work.

Solution: Apply a tablespoon of mayonnaise right onto those water stains. Rub gently for a few seconds and leave. Wipe it in less than 10 minutes; it will work and the surface will be as good as new.

2. Remove dirt marks on glasses of windows and furniture

The issue: There are multiple incidents where I have broken my window glasses while cleaning them up. Practically, with the costly cleaning solution, they (advertisers) used to say “you just need two drops of it”. Trust me! Two drops won’t do anything better. I used more drops and rubbed roughly to clean my window glasses, and… they’re gone! I had to spend a lot on the new glasses.

Solution: Do you buy newspapers or keep them at your house? Bring them and make them wet by spraying water. Before the water gets dry, rub those wet newspapers directly on any glass surface. Let them dry there. After that take a clean cloth and clean by rubbing gently. The glasses will shine like diamonds.

3. Buy prescribed medicines at Costco

The issue: More or less we all have some sort of health issues and for that, we often visit doctors and get prescribed drugs. As a regular individual, you might tend to buy meds from your nearest store when required. But doing that may cost you a bit more and affect your monthly budget. Buying medicines from your local stores can not get you a good discount. But to buy drugs in bulk and get a discount, you might have to subscribe to a costly membership in a popular drug warehouse store. That also hampers your budget.

Solution: Membership warehouse stores such as Costco may give you good discounts on prescription meds. And guess what! You don’t need to be a member to buy them.
Access to medicinal drugs is regulated by the federal government, so medical warehouse stores aren’t allowed to sell medicines only to the members. Customers may use the pharmacy without being a member. So, you may take the advantage and save money on medicines along with on membership subscriptions.

4. Keep journals of your expenses

The issue: Believe it or not, we all overspend!
Yes, it is true. Somewhere down the line, in any part of our life, we all have wasted money without thinking about the future. Spending without tracking is bad for you.

Solution: This is one of the best budget-friendly money saving hacks of all. You may cut your bad spending habits easily if you can track down the total amount you are spending in a certain period. You just need to write down every cash outflow by keeping a daily journal.

After a certain period, let’s say 1 month, you can review how much you have spent and for what reason. This way you may analyze all your expenses and decide which one was necessary and which ones are a waste of money.

With this journal, you can maintain the balance of your income and expenses. You may be able to organize your budget and help you reach your financial goals.

5. Extend the life of razor blades

The issue: You’re getting annoyed of constantly buying new packages of razor cartridges. They are quite expensive and you can’t possibly always buy these in bulk.

Solution: This might sound weird, but I have tried it at my home, trust me it works! Get an old pair of jeans, lay them on a flat surface, and run a clean, dry old used razor several times up the pants leg. Repeat it several times on both legs.

What’s the catch! You have to run the blades backward, don’t shave the jeans. Just hold the razor in the opposite direction. The threads on the jeans will sharpen the blades, similarly like a barber sharpen their blades on a leather strap. If you can do it correctly, you may keep your blades sharp for months.

6. Drink water as your primary beverage

The issue: You are too obsessed with sodas and other beverages that are harmful to health.

Solution: One of the most frugal and budget-friendly money saving hacks is using your house kitchen sink faucet every time you need to drink water.

Fill your cup or a bottle with fresh water, and drink it down. The cost will be nothing compared to those colorful sodas or beers. The bonus? Long-term health care costs also become less than expected.

Normally these days people become ill due to junk food and those colored beverages. Drinking a sufficient amount of water daily is good for health and cheaper than buying sodas. It also keeps you away from multiple health issues, especially from urinary diseases. Have a water bottle with you full of cold water so that whenever you get thirsty, you can avoid a vending machine to buy a beverage. Remember that each time you do it, you’re saving at least $1, and then simply enjoy the water.

How to crush your debt easily with 3 simple steps in 2020

To most people, like me, keeping New Year’s resolutions is difficult. Some people even hesitate to make new year’s resolutions at all. But some people responsibly follow each resolution they make on the occasion of New Year.

Of all types of resolutions, managing finances is one of the most common of all that is usually broken. People mostly fail to get debt relief due to their negligence towards financial matters.

Make sure 2020 is the year when you are definitely going to keep your get out of debt resolution. If you can follow these 3 basic steps to crush your debt, you can reach your goal to become financially free in 2020.


1. List all of your debts from lowest to the highest amount

Relax and take a deep breath. Now you are going to prepare a list of every outstanding debt you owe, a.k.a. your total debt balance. This may include:


  • Credit card debts
  • Payday loans
  • Personal loans
  • Mortgages payments
  • Student loans
  • Auto loan payment

Once you made the list of all your debts, sort out the unsecured debts from that list and create a new final list of debts to start your quest. So, practically mortgage and car loan payments will be out of that list as they are secured debts with a collateral.

*Do not forget to list every balance with their interest rates and creditor names.
Now you have a clear picture of what you owe and to whom.


2. Decide which debt to crush first

Professionals might suggest you focus on the debt with the lowest balance first because it’ll be easier to crush such debts due to the low balance. You may even get out of debts quickly if the entire balance of a particular account is small enough.

But if you ask me, I’d always target the debt with the highest interest rate. The best way to crush your debt is to target your highest interest debts first. It is because the highest interest debt can continuously generate more debt into your account. Normally, payday loans and credit card bills have the highest interest rate compared to other loans.

In some situations, the circumstances related to your debt may push you to pay it first. For example, if you have taken out a loan against your retirement plan and somehow facing issues in your work life, it is better to pay off that debt as soon as possible. To support your quest, you can engage in multiple income streams like doing any side hustles. If you live in a friendly neighborhood where you can arrange a good old-fashioned garage sale, do it. It is the easiest and a low-cost option to clear your unwanted commodities and make a profit out of those things. Once it is done, use the money to pay off your debts.

Once you have determined which debt to target first, analyze your basic expenses again before starting the quest. Start from the current month, make minimum payments on other debt accounts and invest as much money as possible to make payment on the target debt, which is the lowest one.

If you have confusion about how to save money from your monthly budget and make debt payments, it is suggested that you should use the 50/30/20 budget strategy. Keep basic, important expenses on top priority, like housing costs, and engage 50% of your income for that. Then engage 30% for other requirements, and use 20% for savings and debt pay down. You can even use the 20% to repay debt if you can.


3. ‘Snowball’ or “avalanche” your remaining debts

Once you’ve made the list, now it is time to choose the debt payment strategy.
You primarily have 2 options:

a) “Snowball” – List your debts as per their amount, from the lowest to the highest. Engage most of the income to repay the debt with the lowest amount. Make sure to make minimum payments to other debts. Once it is paid off, target the next debt account on your hit list. Again, follow the same strategy on the next debt with the lowest amount and make minimum payments to other debt balances.

b) “Avalanche” – Just like the previous method, you need to make a list. But this time list the debts as per their interest rates, from highest to lowest. Make minimum payments to your other debts and focus on the one with the highest interest rate. Once it is paid off, choose the next with the high interest from your kill lists. It is my favorite debt payoff strategy so far.

You need to take care of your credit score also. Making extra payments each month on your debts can also lower your credit utilization ratio which can improve your credit score.You may also think about the option of debt consolidation. You may tackle your credit card debts by choosing one of the popular debt consolidation methods, a.k.a the balance transfer method. You may also take out a debt consolidation loan (a personal loan) to consolidate multiple debts into one.

The more you pay off your debts, the better your credit score will be.



These are the 3 basic steps to crush your debt. Once you gather debts, you should try to get rid of them as soon as possible. Remember, you can’t get debt relief in one night. If you follow these financial steps properly and keep your patience, you’ll definitely progress in your quest to crush your debts.

70 Percent of consumers are in debt – Are you one of them?


The holidays are arriving. But consumers are still crying over their financial owes. As per a survey conducted by CompareCards.com, 70% of Americans are in debt and they are crying over their financial wounds. Around 31% of these people are in financial trouble due to household debt, and 20% of these consumers are worrying due to credit card debt.


Debt is a huge source of stress. Everyone knows about it. Debt takes an emotional toll on the people. Almost 15% of the surveyed people are worried due to unemployment, high cost of living, rents, and mortgage payments. Almost 14% of the surveyed people are tensed due to tight budgets.
The survey was conducted on 1004 consumers. But this survey reflects the general consumer debt scenario of America. Consumers have $1,074,979,918 credit card debt in the US , which is a massive amount. And, such a huge debt load is driving consumers to tears.


Only a debtor knows how it feels to be in debt. Sometimes, it feels overwhelming and stressful. It pushes people toward depression and anxiety. Ballooning credit card debt and student loan debt have become a point of major concern for people. And, it’s logical. It’s normal. Anyone would feel stressed.


#Survey result

Millennials are immersed in student loan debt.
70% of Americans are stressed out due to their debt problems.
31% of Americans are worried due to household debt.
20% of Americans are tensed due to credit card debt.
15% of Americans are crying due to inflation.
14 of consumers are distressed due to tight budgets.
Millennials are emotionally perturbed due to student loan debt.
Millennials are also worried about bringing up kids.
Women are crying due to rent and monthly mortgage payments.
Men are more concerned about their auto loans, student loans, and credit card debts

Other financial factors leading to stress and anxiety are personal loan debts, medical debts, retirement, investments in the stock market, tax, credit score, and identity theft.


#How to get out of debt and financial stress

Are you also shedding tears for your debts? Do you also belong to this 70% category? If so, then don’t lose your heart. There are a few tips you can use to get out of debt and depression. Here you go.


1. Think rationally instead of emotionally: Life is not a bed of roses. You can’t expect that there won’t be any problem in your life. If you have debts, you have to pay it off. Don’t panic or get stressed out. It’s natural to be worried when the debt amount is huge. But there are plenty of ways to get rid of debt. You’re not the only one who is in debt. Millions of people are in debt. If they can deal with it, then why can’t you?


2. Create a debt payoff plan: Unless you have a debt payoff plan, you can’t get out of credit card bills or student loans or auto loans or mortgage. If you have credit card debt, call your creditor and ask him to lower the payoff amount. If your track record has been good, the creditor is most likely to give you a settlement offer. The problem is most people prefer crying over their credit card debt problems instead of calling creditors.


If you have a mortgage and can’t make monthly payments, then ask the lender for a loan modification. Refinancing is also a good option for you.
If you have a federal student loan debt, then you can explore various repayment plans to lower your monthly payments. And, if you have auto loan debt, then refinance it if possible.


3. Create a budget to spend less and save more: No matter what debt repayment plan you choose, you have to pay money, even if it’s a small amount. You have to arrange the money, and for that you need to create a personal budget plan. Download a budgeting application after reading its reviews and split your expenses accordingly. Focus on reducing your luxury expenses so that you can save more in the long run. The more you save, the more you can pay toward your debts. See also: How can you make a perfect budget when you are jobless?


4. Get advice from the professionals: What do you do when you’re suffering from viral fever? In most cases, you consult a doctor and get the required medicines to be fit. Likewise, when you have debts and can’t pay them off, you should get advice from the certified credit counselors and debt negotiators. These people have immense knowledge on the various ways to get rid of debt. They know the root cause of your problem and also the solution. They also know how to negotiate with creditors and grab an affordable repayment plan for you. So if you’re in debt, then you should approach a debt relief company and ask for a solution.


However, don’t be in a hurry. Make a thorough research on the debt relief company before making the final call because scams are also rampant in the country. Read more: Clear your debts with professional help and DIY Options.


Final words

There are thousands of people who are going through debt problems in our country. They need both help and hope to recover from debt distress. If you’re one of them, then use the aforementioned tips to repair the broken parts of your financial house.