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Amassing mountains of debt is not an uncommon occurrence in modern America. Most people have credit cards, loans, bills, mortgages in some combination or other, and although many people are able to manage these debts with ease, others end up getting into trouble and getting overwhelmed.
Being overwhelmed by debt is not a good position to be in. Not only is it tough financially, but it can take a terrible toll on your mental and even physical health when it gets to the point that you can no longer cope. If you’ve taken on more debts than you can comfortably deal with, you need to take steps to remedy the situation as soon as possible. Here are a few things you could do to that end:
File for bankruptcy
If you have so many debts that you simply cannot see a way forward, it may be worth looking into how to file chapter 13 bankruptcy. A lot of people are terrified of the thought of going bankrupt, but it is less scary than you might think and it could help you to get a fresh start without losing your home or being plagued by debt collectors.
Consolidate your debts
Consolidating your debts is another less extreme option that you may want to consider if you’re currently overwhelmed by having to manage lots of different debts, When you consolidate, you use one lump sum to pay off all of your existing loans, credit card debts, etc. so that you are left with only one monthly payment to manage. This makes life easier for you and will normally cut the cost of interest you’re paying too. It’s a great way to take away some of the stress that comes with managing lots of debts.
Downsize and cut costs
Downsizing to a less expensive home is a great way to free up some extra cash that you can then use to clear your debts and have an easier time of it financially speaking. If you are able to move to a smaller home or a home in a more affordable area, it is definitely worth considering.
Similarly, cutting your living costs, whether that be by changing to cheaper power suppliers, cutting cable, or shopping for groceries at a discount store can also help you to free up more money for debt repayments, albeit on a smaller scale.
Arrange a settlement
Some banks and credit card companies are willing to negotiate with individuals who have forgotten themselves in trouble with debts. It’s not always the case, but more often than you might think, they are willing to freeze interest to give customers a bit more breathing space or even accept a settlement repayment which amounts to far less than the actual debt owed.
It can be daunting speaking to credit providers about your issues, but it is far better than burying your head in the sand and letting things spiral.
Debt is a tough subject, but when you’re overwhelmed, you do have options available to you – you just need to be brave and use them.
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