If you want to become your own Debt Management consultant and clear your Bad Credit and Debts then check out our simple steps to clear your debts that have been provided by In2town Lifestyle Magazine Debt Management expert. With the present climate with the cost of living increasing and high unemployment it is very easy to get into debt so do not feel like you are the only one in your situation. Getting into debt is nothing to be ashamed of, it is the way you handle the Debt Management that you need to focus on to get yourself out of Debt. If you do not wish to use a Debt Consolidation Loan then check out our simple steps to help you to sleep at night and clear your debts.
Become A Debt Buster And Clear Your Debts
Getting into debt is nothing to be ashamed of, it is not hard to get into debt with mortgages falling behind, high interest rates on credit cards and falling behind on council tax which seems to be getting higher and higher. But what is important is the way you deal with your debts and how you get them under control before they make your life a misery.
With our Debt Busters Advice we want you to be able to handle your debts and become debt and worry free in the time that fits in with you.
If you do not intend to take out a Debt Consolidation Loan and do not wish to get a Debt Management company to help you with your debts then let us explain how you can handle the issue of your debt problems on your own.
Work out all your income that you have coming into your house hold, work out any wages you have coming in for you and your partner, and work out any child benefit and family tax credit you have so you no how much each week you have coming into the house.
Now work out all your outgoings that you have, make sure that you are honest with your outgoings. Work out any travel expenses you have, weekly food bill and even include newspapers that you buy and any other items so you have a full list of your outgoings. It is important that you include everything so you know exactly how much you have going out each week or month.
Now you have worked out your ingoing’s and outgoings, you need to know take away your outgoings from your in goings and see how much money you have left over.
Now put a list of your outgoings in order of the most important. So for example, your mortgage or rent should be at the top of your list. Then your council tax should be second. It is important that you make your council tax as high priority on your list as unfortunately most councils do not have a heart and you will receive charges for not paying on time.
Councils are well known for not being human. If you fall behind with your council tax then they will have no problem in putting a charge on top for it going to court and then if you still fall behind you will receive more charges from the bailiffs. So it is important that you keep your council tax up to date and if you do feel like you are going to fall behind then speak to them and see if they have a heart and explain that you are in financial problems and ask them to work out a payment scheme for you. Some councils will do this while other councils are not interested and will not, so please do make your council tax payments as high priority.
Your list should be a list of who are the most important people that you should be paying. A secret for you. Your Water Bills can be low on your list. I am not saying you do not need to pay for these because you do but water companies are less likely to start chasing you and hassling you when you fall behind. They will send you letters but it is rare that they start taking proceedings straight away.
Now you have your list you need to make sure that you pay the most important bills so you can avoid any court action or extra fees as a result of being a late payer.
If you are falling behind with your mortgage then speak to your mortgage company. Most mortgage companies do not want to take you to court and want to help you get out of your financial mess.
One of the good things about mortgage companies when you fall behind is you can ask to pay interest on your mortgage instead of the full payments. This will allow you to have extra money to pay off your debts and will allow you to stop falling behind on your mortgage and use the money that you are saving on your mortgage to get the payments up to date.
Go through all your bills and debts and work out how much you have to pay out. It is important that you do not miss out any debts, as this is your chance to get debt free.
Put your debts in priority. Have a look at your debts and see what stages they have got to. If you have a debt that is threatening to take you to court then you need to make this the top of your list and if you have a debt that is threatening you with bankruptcy then this has to go to the very top of your list.
It is important that you know which debts should be the priority to pay off quicker than the other debts.
Now you have worked out you’re in goings and your outgoings and you have worked out what debts you have to pay, you now need to know what money you have left over to pay your debts.
Go through your list of debts and see which ones is a priority. With your priority list, you need to work all the way from the top to the bottom of your debts and give more money to the debts that are at the top of your list than the ones that are at the bottom of your list.
Be realistic. Do not put down on a debt that you can afford to pay them £40 a week when you know you will now be able to maintain that level of payment. If it important that you are honest and only pay what you can afford.
Now it is time to send each one of your debts a letter which we have done an example below. With each letter you send off, make sure that you have sent them a list of your incoming income and also your outgoings so they can see exactly what money you have left over. Also give them a list of the debts that you have outstanding so they can understand your situation.
If you have debts that you feel you can pay off in one go then do make them an offer but here is a trick to help you. If you owe a company say £2,000 then make them an offer of financial settlement. Negotiate with them and offer them 50% of the debt, you will find that a lot of companies are more than happy to negotiate with you to clear the debt and you could save yourself a lot of money by doing this.
If you are unable to clear your debt then make them an offer of what you can afford per week. Remember be honest with them and make them an offer of what you can afford. There is no point in you paying a higher amount for a few weeks and then being unable to keep to the amount, so offer what you know you can afford.
Explain to them the amount you can afford, explain that you do not want to hide from your debts and you want to pay them and explain how many weeks you can clear the debt over.
Here is the sample letter you should send to companies that you owe money to, to clear your debt. Make sure you keep a copy of each letter you send off and each reply.
Include the following information:
Your Contact number:
Your Debt reference no:
Name of Correct Department
Creditor’s Full Address
I am contacting you today with reference to the following account number: _______________ where I owe your company the amount of __________________.
At the present moment I am suffering financial hardship and would like your help and cooperation in clearing my debt with your company at an amount that I can afford.
As you can see I have enclosed a list of my ingoing’s and outgoings as well as a list of the debts that I owe and I have spent a great deal of time and effort in sorting the money that I owe out to companies so I can become debt free.
I hope you understand that this is a difficult time for my family and me and we would like your assistance in clearing our debt with your company.
After going through the amount of money that I have coming in and the amount of money that I have going out I would like to propose a weekly or monthly payment toward this debt so I can become debt free with your company.
I have gone through my debts and the amount that I have coming in and the amount I have going out and I have found that I can make an offer per week or per month of ___________ to clear my debt. This is the maximum amount I can afford and I hope that you take my consideration into account and my willingness to clear my debt with your company and agree to accept the said amount.
If you company accepts my offer then I can make this payment through a method that you are agreeable to, which can include through my bank account or at a post office.
Upon receipt of a letter of agreement I will then make the first payment to your company and continue to make these payments on a weekly or monthly basis.
Your Printed Name
Step 11. It could be a good idea to send either a cheque or a postal order of the amount that you are prepared to pay each week or month as a show of good faith and to show them your willingness to pay off your debts.
By following these basics steps you should find yourself with less worry and no that your debts are now under control and allow you to get a proper night sleep instead of worrying about your debt.
Also by taking these steps it will allow you to make sure that you are not paying more charges on your debts and that you do not face country court where you could be made bankrupt or lose your house.