Methods of Reducing Debt

Should you sell all your stuff and knock out your debt in one go, or take a slow-but-steady approach? The bottom line, when it comes to reducing debt, is that no single method is better than another. Your own situation and financial habits will help you determine what might work best for you. Regardless of the approach you take, your mountain of debt will soon look more like a small, manageable hill. The Snowball Write out all of your debts...

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How to Get My Student Loan or Loans Out of Default Status

Student loans are considered to be in default if you have not made payments in 270 days if you make monthly payments or 330 days if you are on a payment schedule that includes less-frequent payments. In either case, default is a serious situation that will affect your credit score and demands immediate attention. Instructions 1 If you've received a notice that your loan is in default, contact the agency or lender that sent the notice. Explain...

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How to Manage My Checking Account Online

Managing a checking account online gives you 24-hour access to information about your account. Virtually all banks and credit unions offer online banking, allowing you to easily view deposits, debits, credits and other transactions, such as money transfers. Some banks even offer immediate online help from a live customer service representative during certain hours. People with online checking accounts can also perform important online functions related to their account, such as ordering a stop payment on a check. Instructions 1 Enroll in...

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What to Do When a Builder Goes Bankrupt?

As the economy declines, the risk of homebuilders going bankrupt leaves many buyers stuck with unfinished homes that they cannot occupy for months. For future homeowners, checking a builder's financial history, performance and projects remains their best option. Other ways include the addition of escrow accounts or "springing" clauses to strengthen homeowners' contractual rights. Contractors and subcontractors can accomplish the same goal by asserting...

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Texas Bill Collection Statute of Limitations

A statute of limitations in civil cases sets a deadline by which a lawsuit must be filed. If a creditor or bill collector's lawsuit is filed beyond the deadline, the debtor is entitled to defend himself by asserting the statute in court. The time period for the statute of limitations in Texas depends on the type of lawsuit that is filed; however, for debts resulting in bill collection cases the limitation period is usually four years. Bill Collection Texas collection lawsuits based on bills for goods or services are governed by the statute...

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Will Credit Card Companies Settle for Less Without Hurting My Credit?

When a person owes a significant amount of money to a credit card company and becomes late in paying the debt back, he has several options. First, he can pay back the money he owes. Second, he can allow the debt to remain delinquent and face the potential of legal action from the creditor. Or, third, he can attempt to settle the debt with the company. In the event of a debt settlement, his credit score will likely suffer severe harm. Debt Settlement When a person settles a debt for less than the full amount owed on the debt, this settlement...

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Debt Consolidation Tips

If you are in a great deal of debt, then you know the frustration that comes with trying to climb your way out. Aside from debt being harmful to your financial and personal life, debt itself actually costs you more money in the form of interest rates. Debt can be tough on people mentally, causing undue stress and anxiety. Debt consolidation starts with budgeting and better spending practices and is completed by leveraging your assets and credit transfers to interest-free opportunities to attain a more comfortable financial situation. Budgeting...

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How to Negotiate Charge Offs With a Collection Agency

If a creditor is unable to collect a debt from a consumer, the creditor may label the account as a charge-off. When a consumer becomes seriously delinquent on a debt, the creditor may send the past due account to a collection agency--and the collection agency will attempt to collect the debt. If you currently have a charged-off account with a collection agency, you should try to pay off your balance as soon as possible. Learn the proper way to negotiate...

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The ABCs of Avoiding Bankruptcy

Filing bankruptcy is one way to deal with your overwhelming debts. By means of a bankruptcy, a court may decide that you're no longer liable for your debts. Bankruptcy can help stop harassing creditor phone calls and provide you with a fresh start. However, bankruptcies have severe consequences, and you should file only as a last resort. Know your options for avoiding bankruptcy before contacting an attorney. Why Avoid Bankruptcy? Filing bankruptcy has a major impact on your credit score. According to the Consumer Credit Counseling Services,...

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How to Report Tradeline Accounts to Credit Agencies

Companies report trade line accounts to the credit reporting agencies on a regular basis. A trade line will list all of a debtor's account information such as balance, date last paid and high credit. If you want to report such items to the agencies you have to meet certain requirements and qualifications. A representative from the credit reporting agency may have to visit your business and perform a physical inspection to make sure you have designated office space. You should be a member of the credit reporting agency you want to report to. ...

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The Need for Debt Management

The need for debt management is underscored by its avoidance of out-of-control costs and prudent addressing of existing debt concerns. Debt management plans that use credit-counseling services often lead to negotiation of lower interest rates and debt repayment schedules. The need for debt management is premised on advantages of financial health such as improved budget allocations, peace of mind and enhanced financial planning. Measurement ...

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How to Stop Zombie Debt

Zombie debt can come back to haunt you. It's a debt that you may or may not have defaulted on in the distant past. Debt collection companies buy these old debts for pennies on the dollar and then harass you, trying to make you pay--raising this debt from the dead. In many cases, though, you are no longer required to pay this debt--it may have been debt due to identity theft, have been cleared through a bankruptcy or have passed the statute of limitations....

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Debt Management FAQ

When you decide to start managing your debt, you develop some questions about what you should do and how different events affect your credit. It is important to have the answers to all of your questions before you start any debt management program. Can Late Payments Affect My Credit Rating? According to the Wall Street Journal, when you pay your credit card bills has a significant effect on your credit score. Paying your bills on time ranks just slightly higher than making sure you pay at least your entire monthly minimum. To pay your...

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How to Remove Your Name From a Cosigned Automobile

Co-signing on an automobile is a risky proposition. Many parents co-sign for adult children buying their first new car after college. Some people even co-sign for friends or co-workers. The result can be disastrous because lenders fully expect the co-signer to pay the full balance on the loan if the primary borrower defaults. Options for removing your name as a co-signer on an auto loan are extremely limited. Instructions 1 Monitor the payments on the loan. This does not remove your name as a co-signer but could alert you to possible financial...

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Can I File Bankruptcy on My Repossessed Mobile Home?

It is possible to file for bankruptcy due to debt from mobile home repossession. A mobile home is a secured debt, with the mobile home itself serving as collateral for the loan. The lender has the right to repossess the mobile home if you stop making payments. However, the problems often don't end there. The lender will sell the mobile home at auction or through a private sale and hold you responsible for the balance if the mobile home sells for...

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If I Default on an Internet Payday Loan, Can I Make Arrangements?

Internet payday loans operate similarly to brick and mortar payday loan operations and follow the same laws. If you took out a payday loan over the Internet, then on a prearranged day, usually your payday, the lender will take the money to cover the loan directly from your bank account. If the money is not in your account, you are considered in default. Since payday loans can have an annual percentage rate of over 300 percent, the interest can accumulate quickly once you default. State Law Research the laws in your state concerning payday...

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When Does a Credit Card Charge Off Debt?

If you haven't made a payment on your credit card in a long time, eventually the credit card company will charge off your account. A charge-off can have significant long-term consequences for your financial health. What "Charge-Off" Really Means Some people think that charged-off debts are somehow eliminated and that they don't have to pay them. This is untrue. "Charge-off" is an accounting term that describes a debt that the creditor doesn't...

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Should I Buy a New Car or Pay Down a Line of Credit?

Balancing your debt responsibilities isn't always easy to do, especially when you're considering a new purchase. If you have debts, such as a line of credit, and are considering a new car, you need to carefully evaluate your finances before deciding on what to do. Talk to a financial adviser if you need help planning out your finances to determine if you can afford a new car. Finances When you're deciding whether or not to make any new purchase...

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Loan Benefits for Vietnam Veterans

Vietnam veterans, like all veterans of the U.S. armed forces, are entitled to certain medical and financial benefits. The government department in charge of dispensing those benefits is the Office of Veterans Affairs, or VA. All veterans should contact their local VA office to ensure they are taking full advantage of the services offered. Lending and the VA The Department of Veterans Affairs is not a direct lender. Instead, the government joins with approved lenders to offer qualified veterans government-sponsored loans. Such lenders must...

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How Much Does a Judgment Hurt Your Credit Score?

Judgments may have a profoundly negative impact on your credit score, as they will not only lower it but will stay on your credit report for a number of years. Avoiding judgments is thus one of many ways to obtain good credit. There are a number of ways to remove or dispute credit scores on your credit report. Judgments A judgment is a decision made by a court regarding debts owed to a creditor. It is a way of legally enforcing a debt. After...

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The Downsides of Credit Cards

People seldom pay with cash anymore. Stores, both online and offline, post the logos of the credit card brands they accept, and these days, you are surprised when a store does not accept your preferred card. Credit cards allow people to make purchases by sliding a card or typing in information. Although credit cards are convenient, there are downsides to using them. They are a little too convenient, and this convenience comes at a price. Intangibility...

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Can I Get My Credit Report More Than Once in a Year?

Each consumer has the right to receive one free credit report from each of the three credit reporting bureaus every year. You can check your credit report with a particular bureau more than once each year, but you will have to pay a fee. Regardless, multiple checks are a smart way to protect yourself from identity theft and other fraudulent activity that can harm your credit rating. Annual Credit Report Free credit reports are available from the Annual Credit Report website. This authorized agency gives consumers quick access to all three...

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How to Properly Handle Identity Theft

Addressing identity theft the moment you realize a problem is key to removing fraudulent activity from your credit report. Identity theft involves another person stealing information such as your Social Security number and acquiring new credit accounts in your name. In the aftermath, identity theft can lower your credit score and stop credit and loan approvals. Instructions 1 Write the three reporting agencies. Experian, TransUnion and Equifax are the three major credit bureaus (see Resources). Contact each bureau by telephone or in writing...

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How to Use Payday Loans to Improve Credit

Payday loans can be a good way to help out during a financial crisis or some type of emergency that you need fast cash. Payday loans are short-term loans meant to help borrowers get through until their next paycheck and are generally easy to be approved for. Not only are they helpful for bills and extra spending money, payday loans can actually help improve your credit score. Instructions 1 Take out a payday loan that you can easily afford to pay back on time. This will look good to the credit companies that handle your rating. When you...

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Tips to Raise the Beacon Score

The BEACON score was created by Equifax and Fair Isaac to evaluate the chance that a consumer will become seriously delinquent in his credit accounts in the next two years. An algorithm analyzes a consumer's credit report to determine how large a credit risk he is, and then returns a score number that represents that level of risk. The BEACON score is fluid -- it's based on exactly the information that's in the credit report at the time the score is requested. You can raise your BEACON score in the same ways you'd raise your FICO and other credit...

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What Affect Does Debt Negotiation Have on Your Credit Score?

Negotiating a debt settlement with your creditor can allow you to settle an account for much less than you owe. Allowing a debt management company to negotiate with your creditors can also save you money in reduced interest rates and smaller monthly payments. Each avenue of credit negotiation has a different impact on your credit score. Debt Management Plans Your enrollment in a debt management plan alone cannot hurt your credit score, according to Bankrate.com. Your creditor may make a note on your credit report informing each credit reporting...

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What Happens to Unpaid Debt in a Divorce?

When you file for divorce, you and your spouse must split up all the property either party owns, including any debts. Though the laws governing this process differ among states, you and your spouse must still pay for any unpaid debts in accordance with the terms under which you acquired them. Credit and debt issues in a divorce can be complicated, so talk to a lawyer if you need legal advice. Property Settlements As long as you or your spouse...

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Is There Debt Relief for Child Support?

Child support is considered a domestic support obligation. As such, it is treated differently than other types of debt when you seek a traditional form of debt relief such as bankruptcy. If you can't meet your child support obligation, you should obtain a child support modification or set up a payment plan. Bankruptcy While bankruptcy does not discharge your child support debt, it can help you tackle the debt. In a Chapter 7 bankruptcy, your assets are first used to pay off child support debt and other domestic support obligations. If your...

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Debt Validation Requirements

A debt collector is required under the Fair Debt Collection Practices Act (FDCPA) to notify a debtor in writing within five days after initial communication. This written communication is commonly referred to as a dunning letter. The dunning letter must state the name of the original creditor, account number and amount of the debt. The letter must contain a disclaimer that states that the letter is a communication from a debt collector, that it...

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What Is Debt Analysis?

Debt analysis can have slightly different meanings depending on context. When used to assess the financial health of an individual, it is basically a comparison of how much the person, or a household, makes versus how much he owes. Consumers usually owe money but typically are not owed much. However, businesses often are lenders as well as borrowers and can use debt analysis to asses their assets or liabilities. Consumers When analyzing the debt of an individual, the primarily concern is the person's repayment ability. This capability...

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Will Canceling a Credit Card Lower My Credit Score?

Any time you open a credit card, how you treat that line of credit will affect your credit score. If you decide to cancel a credit card, different factors come into play regarding whether your score is lowered. By educating yourself, you can make good decisions about how best to safeguard your credit score. How Credit Scores Work Your FICO credit score is what most creditors refer to when inquiring about your credit history and habits. Thirty-five...

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Can a Borrower Request Foreclosure?

Borrowers typically don't request a foreclosure, but can accomplish the same goal through other requests made to their lenders. Most times, the borrower's objective is to stop paying the mortgage and to transfer ownership of a home that is either too expensive or no longer wanted. Some people simply walk away from their homes in what is known as a voluntary foreclosure or strategic default. However, those maneuvers can cause costly financial ramifications and are not recommended by lenders. Strategic Defaults A homeowner considers strategic...

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How Does One Become a Credit Counselor?

While becoming a credit counselor does not require a certain degree or certification, agencies employing credit counselors have preferences when it comes to job candidate backgrounds. Prospective employers look for candidates who have previous experience in counseling including, peer counseling in college, education counseling or human resources. Credit counselors interested in becoming certified can do so at any time; however, gaining certification prior to looking for work can increase your chances of finding a job. Education Obtain an...

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Do You Need a Credit Check for Line of Credit?

Credit checks are standard when applying for lines of credit such as signature loans and home equity loans. A neighborhood store or hotel casino could extend a line of credit without a credit check, but those are unique examples. Banks, credit unions and similar lending institutions will certainly require a review of your credit. Credit Scores Credit scores range from 350 to 850, with a score of at least 620 usually needed for approval on lines of credit. Scores of 720 or higher are preferable and qualify you for lower interest rates and...

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What If I Don't Pay Alimony in Florida?

Alimony awards require one spouse to pay the other spousal support maintenance for a defined period. Typically, the alimony payment obligations terminate upon the death of either spouse or when the recipient remarries or cohabits with a nonfamily member of the opposite sex. When a spouse ordered to pay alimony does not pay, courts can order garnishments or hold nonpaying spouses in contempt of court. Types of Alimony Florida courts have the discretion to award alimony on a temporary or permanent basis. Rehabilitative or durational alimony...

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Debt Consolidation Analysis

People who are considering consolidating their debts should weigh the costs before signing on to a debt consolidation agreement with a creditor or lender. The overall goal of consolidation should be to reduce monthly expenses and interest rates. A consumer can be left deeper in debt by not calculating the costs of consolidation. Balance Transfers Consider transferring credit card debt with high interest rates to a card with a lower rate instead of applying for a consolidation loan. Loan applicants usually face a longer approval process...

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