Four paths to consider to help you Get Out of Debt
It is no surprise that times are tough. The economy is roiling, jobs are becoming scarce, and inflation is high. All of these things can impact your ability to take care of your family and pay your bills on time. Sometimes, paying bills comes last.
Before it gets worse, talk to a financial institution about getting help to get on the right track. At the Ashland Community Credit Union, we are “people helping people”, and we want to help you if you’ll let us try.
But if you’re already deeper in debt than you should be, you may be considering your next move.
Here are four paths you might consider if your budget and your debt are headed in opposite directions before you get into some real issues that may lie ahead:
One: Consider Credit Counseling
Credit counseling involves working with a certified credit counselor who helps review your financial situation, provides budgeting advice, and educates you on managing money and debt. This is an excellent way to change the way you view debt and your budgeting process.
Two: Consider Debt Management
A Debt Management Plan (DMP) is a structured repayment plan developed by a credit counseling agency (see above). The agency negotiates with creditors to establish lower interest rates and consolidated monthly payments. This may help to stop collection calls and late fees. However, it may also negatively impact your credit score.
Three: Get Out of Debt with a Debt Consolidation Loan
Debt consolidation involves combining multiple debts into a single loan, often with a lower interest rate. This is our specialty at Ashland Community Credit Union. The goal is to simply debt repayment into one convenient monthly payment, potentially saving money with lower interest rates. Also, you may improve your credit utilization ratio.
Four: Consider Debt Settlement:
Debt settlement involves negotiating with creditors to settle debts for less than the full amount owed. This is the least favorable option, as it may result in long-term negative impacts on your credit score, and may involve tax consequences. Also, not all creditors are likely to settle.
Whatever your next move is, be careful. Consider the pros and cons of each option, and seek advice from reputable financial counselors or professionals. Along the way, be wary of scams and choose legitimate, accredited organizations when seeking assistance.
Remember, you’ve got a friend in the Ashland Community Credit Union. We understand, and we want to help. We stand for community, and you are part of it. Contact us and let’s talk about how we can help.
Let’s grow together!
