It can be difficult to climb out the hole and become debt free when you’re living paycheck to paycheck. But to improve your credit score and erase that debt, you must make difficult choices. Saving money and paying off your debt must be this year’s number one priority.

1. Pay more than the minimum amounts. People fear this statement but let’s dissect it. Start slow and add one dollar, then three dollars, then five dollars to your minimum payment. Yes, all of us can find that extra money if we know where to look.
2. Again, start slow and give up one Starbucks coffee per week. Then, give up one of those expensive lunches per week. This can sure add ten more dollars to your savings. If you can’t give up your morning coffee, how about switching from Starbucks to the corner café. Can you save a few pennies there?  If you absolutely are adamant about paying for a lunch instead of bringing some home leftovers, try switching from that expensive restaurant to a local dive or get a Subway sandwich. The point is, you must find a way to save some money.
3. Put your Credit Cards away… give them a vacation. Instead of the constant spending, stop using the credit cards and then apply more than the minimum amounts to your payments. Now you’re really saving money towards becoming debt free.
4. Pay bills on time. If you find that you are unable to pay any bill on time, call and make payment arrangements. This is far better than having the creditor submit a negative mark on your credit report.
5. Sacrifice in your household. When there is not enough money, we must sacrifice something. Re-negotiate your cable bill and telephone bill and cancel those services you don’t use and don’t really need. If you have every cable channel there is, try going with basic cable for a while or drop a few of your premium channels and save funds.

Reflect on your values, wants and needs to become debt free. All of us must reevaluate what we really want and what’s needed in our lives. If you are spending more than saving, you already know you cannot afford entertainment, so say no to movies and popcorn. It doesn’t mean you won’t return to this lifestyle, just for now, you must put that money to better use. If you’ve made the decision to become debt free, you know cutting corners is vital to saving money.

Bolster yourself with encouragement and understand what you’re working towards accomplishing.

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You know how you accumulated the debt and now you’re looking for debt solutions. Whether it’s lost of a job, divorce or just poor financial skills, you’re in too deep and you need a resolution fast. Debt solutions should be practical and include an understanding of how you arrived in this financial mess so you don’t repeat mistakes.

You first take on debt solutions will include preparing a list of your financial responsibilities. Start your list with your major monthly bills that must be paid, like mortgages, food, car and credit card payments, utilities, insurance, etc. Next, think of any expenses that can be cancelled or at the very least reduced to an acceptable amount.

• Review your cable bill. Many times we have so many channels and most we don’t even watch. How many premium channels do you have? Now is the time to smarten up and take a hard look at what you need versus what you want. Call your cable company and negotiate your bill to a lower monthly amount. You could cancel your premium channels until you decrease your debt ratio.
• Telephone bill. Call your local telephone provider and negotiate your bill. You can cancel the extras on your phone.
• Cell phone bill. Again, call your provider and negotiate your bill. Ask for any specials and decrease your minutes to the bare minimum.
• Utilities. Turn off those appliances, televisions, computers and other phantom electric items that devour electricity that you’re paying for. See, even though you are not using the toaster, microwave, television, and computer and so on, they are still plugged up, thereby utilizing electric currents that you still pay for. You want to see a drop in your electric bill, unplug what you’re not using. Turn off the computer at night and during the day while you’re at work. You we see a big difference at the end of the month.

These cut-back are some debt solutions to help you pay down your debt. Trimming back doesn’t mean forever. It’s only for the mean time while you catch up on your financial responsibilities.

These are the basic debt solutions to start with. You must also understand how you got into your situation and how not to return.

>коли под наемfully you’ve learned that getting out of debt isn’t impossible and takes some work and effort to realize the benefits.

No one ever says it’s easy but never impossible. The tactics are simple to follow if you choose our debt advice. Just be prepared to make some crucial changes because getting out of debt is really a lifestyle change.

You must review the reasons you took this route and learn how to turn things around. No more spending impulsively and throwing money away on items you don’t need. It will also benefit you to understand why you’re an impulse spender? Do you spend when you find yourself in turmoil? If this is true, you’ll notice that buying something new doesn’t change anything. You’re still in the same pickle you were in before you spent the money and you probably feel worse now.

Keep in mind, debt cures don’t start out feeling good but just wait until you begin noticing a decrease in bills in the mailbox and more money in your pocket. It gets easier to become debt free; just remember the benefits you’ll reap and keep up with your new strategies to saving money and paying off your debt.

Now that you’ve learned some simple strategies to getting out of debt, here are more ways to cut back and put more money in the bank;

1. Review your cable bill and cut some of your premium channels. If you have all the premium channels there is no way you look at all of them on a daily basis. If you reduce some of them you probably won’t even notice that their gone. And this is only a temporary basis. You can call up the cable company at any time and add the channels back. Develop a plan to cut your cable costs for the next 6 months. Call and check if they have any promotions and ask for ways to cut your bill.

2. Do you have a telephone and a cell phone? Start by calling both companies to see how to decrease your monthly bill. The companies will not notify you when they have promotions. Don’t expect them to call you and ask if you want to decrease your bill; you must make a move and ask the representatives how to slash those charges. Deduct what you don’t need. You can add it back at another time. Additionally, did you know that you can put your home land line on standby for a small fee? This means you are not being charged your normal bill. Use your cell phone for a while.

Getting out of debt takes courage, strategy and a strong willed person to know when enough is enough. No one enjoys the insurmountable bills and constant harassment of debt collectors and soon find that debt cures will take more than wishing and hoping for a better tomorrow.

Many of us look at that hill of bills and cannot see a new beginning but getting out of debt isn’t impossible if you sort through the mess and develop a plan of attack. You need solutions to the way you spend money and ways to cut expenses. Here is a simple route to formalizing your plan;

1. Create a budget of all Income and Expenses. Include everything from Utilities to travel expenses to dry cleaners and food. Once you develop this budget you’ll have a better view of getting out of debt and what things to eliminate.

2. Start with your utilities. We’ve all experienced increases in our energy bills but you can overcome so of those fees and bring that bill down. To cut your energy costs go around all your rooms and begin unplugging things you never or rarely use. Do you have more than one computer? Turn off the one you rarely use. Your cell phone charger – unplug until you need to use it. Do you use your toaster on a daily basis? Unplug it. In fact, unplug any appliance that just sits there without any use.

3. More than one television? Unplug the ones you don’t look at more often.

4. How much do you spend for daily lunches? Most of us will spend $5-6 per day. Bring your lunch to work for 1 week and see how much you save. Put that money away and put towards a bill.

5. Start using coupons. Look through the newspaper or online. Many grocery chains and promotional websites offer coupons. The coupons will add up when you go to the grocery store.

6. If you’re using a dry cleaner, stop using so often. They sell special dryer sheets that you can use for your clothing to defray some of these costs. This will certainly shave off a few dollars by months end.

7. Cut most of your entertainment expenses. This can be difficult to do but instead of attending the movies on the weekend, get a book. And if you have cable at home, that’s all the more reasons not to go to the movies. Stay at home and turn to a channel you never watch. This is a great time to learn something new. I never thought of looking at most of the channels my cable company offers but you can learn new things you never thought you’d be interested in.

These are simple strategies to defray many of your monthly costs. If you take some time to review your budget you’ll find that you can eliminate many of your usual costs that are unnecessary.

While Nancy Pelosi is blaming our financial meltdown on Republicans, and Republicans are getting even by voting down the $700-billion financial-bailout package — and while panicked investors react to the congressional backstabbing by sending the Dow Jones industrial average down a frightening 778 points — I get an e-mail from my friend Clayton.

Clayton is about to retire. He lives in a small city in the South and figures he could live comfortably the rest of his life on his savings, which are mostly in the stock market. Now Clayton is beside himself that his savings are being set afire by the dithering politicians.

Read more

Before you think of debt consolidation take a stand and try avoiding debt and look at other options that may help you turn your finances around. It’s vital to be aware of alternative actions you can take to avoid financial problems and steer clear of debt consolidation.

Why? Debt consolidation looks tempting but due to the high interest rate, you’ll be paying back a lot more than you think. And all the clauses and stipulations in a debt consolidation loan package are not advantageous to the consumer and you could end up with nothing.

If you’re experiencing financial woes, try avoiding the following debt traps which will ultimately lead you to the downfall of a debt consolidation loan:

• Don’t ignore your most important debts. For reasons that are obvious like utility shut-offs, evictions and repossessions, it’s dangerous to ignore your secured debts and certain types of unsecured debts. When you can’t pay everything, remember what’s important in your life…shelter, warmth, food always comes first.
• Don’t continue to use credit. Regardless of whether you are experiencing a temporary cash shortfall or you’re having more serious and long-term money troubles, avoid using credit until you say goodbye to your financial woes.
• Never make a promise to any creditors that you can’t keep. If you are feeling overwhelmed from a creditor about past-due debt or you feel guilty about being unable to pay what you owe, try and work out favorable payment arrangements, but never say you’ll pay any amount that you know you cannot fulfill. When you don’t pay what was agreed to, the creditor will ultimately begin more aggressive payment options.
• Do not obtain a risky loan. Some finance companies, for-profit credit counseling agencies, and other types of fix-it firms are in the business solely for setting you up with some form of risky loan. They’ll promise and promote loans that sound good on the surface but usually come with very high interest rates and require you to use something as collateral. Often the contract you sign is vague and confusing and you wind up in a debt trap.
• Do not sign up with a disreputable credit counseling agency. Now-a-days you’re able to repair your own credit. It’s easy to become educated and help repair your own situation. Why pay a for-profit or non-profit agency that benefit from you financial problems?

Today’s economy certainly has not made it easy for avoiding debt traps and many are signing up for debt consolidation loans. Many of us panic and are not sure just how to handle a sticky situation.

A debt consolidation loan will rarely reduce the amount of money you owe. There will be new loans costs added to your balance. Your interest will also go up because you will be taking much longer to pay off the new loan. Consolidation borrowing almost always adds to your debt. In other words, you can’t borrow your way out of debt. In other words, you can’t borrow your way out of debt.

Let’s imagine your current bills total $10,000 and it will take five years to pay off a consolidation loan as a payment of $250 per month. With this loan structure, your new debt, with interest, equals $15,900.

The act of debt consolidation usually results in a somewhat lower monthly payment, but this payment must be made for a much longer period of time. For example, you could also consolidate that same $10,000 debt so that your payments would drop to half the $250 that we previously said. This would make your new payment only $132.50 per month.

Sounds great, doesn’t it?  Think about it, though. The term of the lower monthly payment will now be 12 years instead of five years. So, your true total debt will go up over $19,000.

Consolidation by a bank or finance company usually will not reduce your total cost in terms of time served to pay off your debt. These institutions almost always charge a higher interest rate because your risk of default or bankruptcy has increased since you made the original loans.

Debt consolidation is just another way of enslaving you in further debt. The lender is the one who benefits, not the borrower. Debt consolidation is done for three basic reasons:

1. It discourages bankruptcies
2. It gives the lender a chance to adjust the interest rate upward.
3. The lender has the opportunity to add collateral to the loan.

The only exception to debt consolidation is if you can get the interest on your total bill reduced. The debt would be paid off quicker because more of each payment will be going toward the principal and paying off the balance of your loan.

Again, you cannot borrow your way out of debt; you can only borrow your way deeper into debt.

By: Shannon (Guest writer)

Let’s begin with Guarded Secrets #3 that Debt Collectors try and hide from consumers. The biggest secret that Debt Collectors and Debt Collection Agencies don’t want consumers to find out is many debt collection agencies cannot try and collect any money from you.

Note: Part 1 of this two-part article is published here.

Many of them are doing business illegally. You see ALL debt collectors must be licensed and bonded. You can go to your State Assessments website to check the debt collection agencies license. Remember, having a business license is the first step. They must also be bonded. In lieu of checking via the internet, you can call your state attorney general’s office to check and see if they are licensed.

If you find that the debt collection agency is not licensed simply write them a letter explaining that according to your Attorney General’s office, that company is not listed and you do not support or encourage unlicensed businesses in your state.

Therefore, you are unable to provide any further information until that Debt Collection Agency can show that they are licensed and bonded in your state. Funny right!  Yes, I have sent many letters like this and never heard from the Debt Collection Agency again.

An unlicensed company that is doing business in your state can be sued, and you can inform them of this just to let them know you are educated in your consumer laws.

Guarded Secret #4: Many consumers don’t know anything about Statute of Limitations. This is the time period that any legal action can be initiated. Once the Statute of Limitations runs out your obligation to repay expires.

For example, you get a credit card and don’t pay the balance off and 10 years go by and suddenly you hear from a debt collection agency telling you they are collecting on this past credit card debt. They cannot legally collect because the statute of limitations has passed. Simply explain that the statute of limitations has passed and hang up the phone. No other explanation is necessary because the Debt Collector will know exactly what you’re referring to.

Each state has their Statute of Limitations, so you should check into your specific state information.

These are simple legal strategies that every consumer is afforded. No one is willing to tell us that most of our debt we do not have to pay back. We must educate ourselves and learn how to stay ahead of the curve. If you don’t you could be paying a lot more than you have to.

Don’t forget to check out part 1 of this article if you missed it.

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 Which credit repair course shows you little-known ways to legally remove negative items from your credit file? Find out now at Credit Secrets Review.

Most people know very little about debt collectors and debt collection practices and what is legal and what is not. When you become caught up in a downfall of unpaid bills, harassing phone calls from debt collectors and not knowing what to expect from debt collectors you fall into a category with millions of other consumers.

There is no gimmick; no tricks and no mystery to what debt collectors can do and what they can’t do. While the law is on your side, you really must decipher exactly what the law can do for you and how to enforce your rights. So here are some consumer rules for you to follow when debt collectors began harassing you. These are laymen’s terms for consumers.

• Debt Collectors and Debt Collection Agencies that have been hired on commission to collect on bad debt are considered third party. You do not have to deal with a third party collector. Just tell the debt collector that you do not deal with third party collections and you only deal directly with the original creditor…then hang up. Its that simple.
• Debt Collectors and Debt Collection Agencies can own the debt if the original creditor sells them the debt. Many creditors understand the time and expense it will take to collect on bad debt, so they simply sell it to a debt collection agency. The debt collector begins harassing you to recoup that money. But now, they are the creditor. Even with this in mind, you can dispute the account and tell them to send proof.

**Here is guarded secret #1. When creditors sell an account, it’s usually an old account and they usually (about 90 percent of the time) do not transfer all pertinent paperwork with your file to the new creditor. Or, the new creditor, in haste, misplaces the original documents, thus, now they are unable to prove that you owe the money. In order to prove the account is yours, detailed information is really needed because if you go into court they must prove that this account is 100% yours. This is why you ALWAYS deny, deny, deny and dispute any recollection of that account.

• Debt Collectors will call you and go through the charade of starting legal proceedings if you do not pay that day or that week. They will try and force you to send money via Western Union and they are always willing to negotiate to a lesser amount or a repayment plan over a few weeks. Do not fall for this tactic. Never pay and Never promise to pay any amounts. You always say you do not recollect any account and you need proof.

**Here is guarded secret #2. If you pay on any account, even the smallest minimum, this can re-start your obligation to pay that account all over again. See, the courts see it like this; if the account wasn’t yours you would never send money to pay on it, therefore, you are acknowledging the account by paying money towards the balance. This is why you NEVER, NEVER pay.

These are a few tactics Debt Collectors and Debt Collection Agencies will use to get you to obligate yourself in paying a debt. Once you obligate yourself, it can then be listed on your credit report. When dealing with Debt Collectors and Debt Collection Agencies, never provide any information and never promise to make any payments.

Your goal is to raise your credit score so you can enjoy lower interest loans, lower insurance premiums, a more affordable mortgage, and all the other benefits of good credit.  You have already gotten copies of your credit report, and identified the negative items that are bringing down your credit rating.  You have submitted forms to the credit reporting bureaus, disputing the negative information that they have been distributing in your credit report.  And now, you have just gotten back rejections of your credit disputes.  What should you do next?  That is the focus of this article.

Don’t be surprised that it isn’t easy to erase the bad news from your credit report.  It seems that they make it hard, on purpose.  But with a little perseverance, you can be successful. 

First, check the dispute letters that you had originally submitted.  Were you concise and accurate in stating your case?  The credit bureaus and lenders get a ton of dispute letters every week.  In order to make sure your letter is actually read and understood, keep it short and to the point.  Do not include details that will only confuse the situation. 

Don’t try to impress or scare them by quoting the law.  You may be tempted to include legal wording in your dispute letters, particularly if you feel that they have violated the law.  But a personal letter will be much more effective.  Maybe an exceptional circumstance, like an illness or divorce, forced you to default on your debt - tell them that.

Did you include documentation with your letter?  Always include anything that backs up your case.  Do you have cancelled checks or bank statements that prove you made a disputed payment?  Of course, never send the originals - make copies of all your documentation. 

If your dispute letter was rejected by the credit bureau, be sure to correspond with the lender or organization that reported the negative item to the bureau.  If you’ve ever contested a charge on your charge card, you know how they play this game.  You ask the credit card company to delete a charge you think is wrong.  The credit card company says they will suspend the charge while they investigate.  They check with the merchant who recorded the charge, and - surprise! - the merchant says the charge was valid, and the credit card company re-instates it on your bill.  Thanks for nothing.  Well, you’ll probably get a similar run-around when you contest items on your credit report. Try a different angles in your follow-up letter.  You should try dealing with a different department in the lender organization to see if they are more sympathetic to your cause. 

Persistence will pay off.  If you deal with the credit bureaus and financial institutions in a professional, but firm way, you are more likely to be successful in your dispute.  Remember, that although your dispute is with an organization, a person will be reading your letters.  If you connect with them in a personal way, they are more likely to understand your position.

Courtesy of: The Credit Secrets Bible