Five Solutions for Financial
Resolution
At Community Credit Counseling Specialists we believe
that there are five different ways to resolve the financial difficulties
that you may be facing. These five are the basic paths that you can
follow to payoff your existing debt. The five options are not exclusive
and may need to be used in conjunction with each other to reach your
desired financial goals.
They are listed below in order of importance with the first one being
the best option and the last one being the path of last resort. If you
are not sure which option is best for you then contact a Community
Credit Counseling Specialists counselor and let us help you find your
own personalized path to debt freedom.
1.
Contractual Repayment:
Of course the best option is to repay your debts according to the terms
under which you borrowed the money. This course will cost you the least
and leave you with the best possible credit.
If you are not happy with the interest rates that you are paying then
refinance your accounts to a better rate or roll you credit card account
balances over to a card that has a lower rate. Keep in mind that this
option does not include just making the minimum payments on everything.
If all you can afford to do is make the minimum payments then you are
really only one emergency away from falling behind.
Ideally you should be paying your credit card balances off every month,
but when this is not possible you should strive to pay at least two
times the minimum due. If you find that this is not possible then maybe
you should look at option number two.
2.
Budget Revision:
When Contractual Repayment is not possible then maybe all you need to do
is start using a budget or revise your family’s existing budget. If you
are not using a budget and you are finding yourself living paycheck to
paycheck, then it is time to take a close look a where your hard earned
money is going.
Most monthly expenses are fixed and unchangeable, like rent/mortgage,
car payments, insurances, etc. Some however are discretionary and can be
altered when needed, like food, gas, entertainment, even cable or
internet. If your budget is tight it is with these discretionary
expenses that changes will need to be made.
When reviewing the budget do not make guesses at how much you spend but
instead review your check book and ATM withdrawals. Use numbers that are
at least a three month average to get an accurate accounting. If after
reviewing your budget you still can not afford Contractual Repayment,
then maybe you need to look at option number three.
3.
Asset Reallocation:
Do you have items of value that you could sell or borrow against to help
pay down the debt load you have? The goal of this option is to either
get rid of assets that you may owe money on, or to generate money to pay
down balances on other existing debts by selling off those assets, or in
some cases borrowing against those assets.
Of course, we all have some “stuff” that we could get rid of; garage
sales (or even Ebay) are a great way of disposing of the extras that
have accumulated. Once the items have been sold off, then use the
proceeds to pay off as much as you can. It is better to pay off smaller
balances, then to pay down the higher interest rates because by doing so
you will free up more money, in the payments you will no longer have to
make. The use of equity in the home is a very enticing lure; however you
need to be wary of what you are doing before utilizing this asset.
First, if you use the equity in your house to pay off credit card and
other debt you will be turning uncollateralized debt into collateralized
debt, meaning that if some financial catastrophe happens and you can not
meet you payments your house is now in jeopardy.
Second, even though the interest rate appears less, over the term of the
loan you will be paying back much more. If all you are trying to do is
reduce your outgoing, look into refinancing just the mortgage at a lower
rate, which will reduce the monthly payment without jeopardizing your
home. If you have made it through all three options and you still have
not found relief then it is time to get help.
4.
Credit Counseling:
Utilizing the Community Credit Counseling Specialists debt management
program will help you get your finances back on track. First a trained
and certified counselor will review with you your debts and budget to
analyze your total financial picture. Arrangements will then be
investigated based upon policies that have been negotiated with the
various national creditors over the decades we have been in business.
These policies come in the form of reduced payments, reduced interest
rates, account re-aging, and stopped late-charges and over-the-limit
fees. By getting these benefits for you the counselor will be able to
set up a payment schedule that will fit within your budget and allow you
to cover both your living expenses and the repayment of your debt.
Utilizing your personalized plan you will then be put on a deposit
schedule with Community Credit Counseling Specialists which in turn
disburses the money to your creditors based upon the arrangements that
were set on your behalf.
The Community Credit Counseling Specialists debt management plan helps
our clients get out of debt faster then they would on their own which
saves them money monthly and over the term of the repayment. If after
reviewing this option you still can not come up with a plan that will
work then you only have one option left.
5.
Bankruptcy:
This is the option of last resort and should be used only after every
other avenue has been investigated. Bankruptcy is the intervention of
the courts on the debtors’ behalf with their creditors. To understand
all of the intricacies of the bankruptcy laws in your state you need to
consult with an attorney, as we are not legal counsel. Most attorneys
will give you a free consultation in an attempt to sell you on their
service and to explain how a bankruptcy could affect you. By filing for
bankruptcy you are taking an action that will stay on your credit record
for up to ten years. This step should not be taken lightly. Let a
Community Credit Counseling Specialists counselor review your financial
situation before taking this step. The consultation is free and will
only take a little time out of your busy day.
With four easy ways to seek help it couldn’t be easier. For the
quickest results call us immediately Toll Free 1-888-662-3313.
If you do not have the time now, use our
online appointment scheduling form and tell us when it will be most
convenient for us to contact you. If you would rather start immediately
to see what Community Credit Counseling Specialists can do for you, then
just click our online enrollment form.
How to contact
us:
Community Credit Counseling Specialists, Inc.
5301 Southwyck Blvd., Suite 100
Toledo, Ohio 43614-1580
Telephone 419-865-2333
Toll Free 1-888-662-3313
Fax 419-868-0207
E-mail
© 2006, 2007, 2008 Community Credit Counseling
Specialists, Inc. All Rights Reserved.
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