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ELIMINATING YOUR DEBT ON YOUR OWN
Below are some basic
financial strategies for do-it-yourself
debt elimination. If you have any questions, please
contact us. Let
StarLoanServices.com help you
become debt free in 2007!
Assess your debts
Gather all of your financial statements and
order a copy of your credit report. We suggest
purchasing a
3-in-1 credit report so that you can see how all the
credit bureaus are reporting for you.
Learn more about 3-in-1 credit reports.
On a piece of paper make a list of all creditors and how
much you owe. Also include interest rates and the
minimum monthly payments required.
** When evaluating your debts, do not factor in your
car loans or
mortgages.
These types of debts have long terms and lower APRs. You
will be better off trying to eliminate those high
interest credit cards and other unsecured debts first.
Determine what your budget is
Now that you have all of the information regarding your
debts, you will need to determine what you can afford as
a monthly payment, otherwise known as
budgeting. The first thing you need to do is
calculate what your net salary is (income after taxes).
Then, add up all of your expenses. Don't forget to
include living expenses like
groceries, gas for your
car, etc.. Subtract all of these expenses from your net
income. This total is the amount you can afford for
making monthly payments for eliminating your debt.
Formulate a plan
You have successfully evaluated your debt and
determined what you can afford every month for payments.
Now you need to make a payment schedule for your debts.
Try using the example below. All of the monetary numbers
are just examples. Try the formula with your own
numbers.
- Monthly net salary (income after taxes) $3,500
- Minimum required debt payments - $1,200
- Monthly expenses/cost of living - $800
- The remainder amount should be used to pay the debt
with the greatest rate and balance: $600
Use this same formula every month until the debt is paid
off. Once that specific debt is eliminated. Begin paying
the next highest debt, using the same formula above.
While using this do-it-yourself debt eliminating
strategy, try and not incur any additional debts.
Try negotiating with your creditors
There is never a bad time to contact your creditors to
try and obtain better rates and terms for your debts.
There is a good chance you can lower your interest rates
and/or even be able to reduce the amount that you owe!
Transfer your debts to credit cards with lower
interest rates
Do some research by checking out some credit
card
offers with rewards. You likely can find a
card that has a lower interest rate than your existing
debt, also offering a 0% introductory rate. It is
important that you do not exceed 40% of your limit in
debt. If you do, you run the risk of damaging your
credit.
Homeowners should take advantage of debt consolidation
products
Star Loan Services offers several second mortgage
options for homeowners looking to consolidate their
debt. Learn more about the
equity loans and
refinance loans for debt consolidation that we
offer.
Be consistent
Try your hardest to stick to your goals. Don't worry if
you don't make your expected payment one month. However,
the only way to get out of debt is to make make the
maximum payments you can afford regularly and to not
take on any additional debts.
It takes a great deal of mental strength and dedication
to eliminate your debt on your own. For many people,
this is just too hard of a task to handle. If you think
that the do-it-yourself debt relief is not possible for
you, please fill out a
free request for our debt consolidation program. We
can help you reduce your debt by as much as 60%, with
lower interest rates and reduced balances.
GET A FREE DEBT CONSOLIDATION QUOTE!
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