Are you drowning in debt? Are you unable to make the minimum payments on your credit card bill, auto loan, or personal loan? If this sounds like you, you’re not alone. A recent survey found that the average American owes about $38,000 in consumer debt. That’s a big amount of money to owe on things like a new car and a vacation. Is there any way out? Thankfully, yes. Several tricks can help get you out of debt faster than you think. Read on to learn more.
Consolidate Your Debt
If you have a lot of debt, one of the easiest ways to get out of debt faster is by consolidating your debt. This is when you combine all your debts into a single, lower-interest loan. Let’s say you have $20,000 in debt at 8%, $10,000 in debt at 10%, $5,000 in debt at 12%, and $3,000 in debt at 4%. If you were to consolidate all of these debts into a single loan, you’d be able to bring all your interest rates down to the lower rate of the single loan. This will save a lot of money on interest and help you get out of debt faster. Keep in mind that not all creditors are willing to consolidate your debt. Shop around to find the best consolidation terms for you.
Negotiate With Your Creditors
If you’re struggling to make payments on your debt, you might be tempted to stop paying entirely. However, this is a very bad idea. Instead, consider negotiating with your creditors. This is when you reach out to your creditors and offer to pay them a lower amount than you owe. This works best for unsecured debts like credit cards. If you have several different credit cards, you may be able to get a single lower payment to pay off everything at once.
Install a Fraud Alert
If you’re particularly concerned about identity theft, you might qualify to install a fraud alert on your credit report. This will put a hold on your credit report, blocking creditors from being able to see your credit score until you take the alert off. Credit bureaus will automatically place a fraud alert on your account if they suspect you’ve been a victim of identity theft. However, if you’re worried about identity theft but don’t think you’ve been a victim, you can place a fraud alert yourself.
Make A Deal With Yourself
If you’re struggling in life, you may be tempted to make all your payments as small as possible. After all, what’s the difference between paying $100 on your credit card and paying $10? The difference is that the $100 payment will get you out of debt much faster. However, you shouldn’t be happy with just scraping by. Instead, make a deal with yourself to pay more than the minimum payment on your debt. You may not see results immediately, but they will come eventually. You’ll be able to boost your credit score and qualify for better loans if you want to buy a house or a car. You’ll also be getting out of debt faster, giving you more space in your budget and making it easier to pay back your debt.
Getting out of debt is daunting, but it isn’t impossible. There are several ways to get out of debt faster, including consolidating your debt, negotiating with your creditors, and refinancing your loans. Whatever method you adopt, the most important thing is to stay focused and determined. With patience and determination, you’ll be out of debt in no time.