First, Self-Control and Then Debt Control

If you are drowning in a cesspool of credit card debt, you are certainly not alone. The Federal Reserve has shown that the Americans have incurred almost $ 1 trillion, an all-time record high, what it refers to as "revolving credit".

Financial experts always advocate people to pay their debts with high interest rates result mainly from credit card debt. It can help you in action when you check your guilt from another angle, "said Hersh Shefrin, aBehavioral finance professor at Santa Clara University. He defined debt as a "form of borrowing against future consumption." This means that paying off high interest credit card now left with more money for themselves is in the future.

Study your income and expenses

Your next step is to analyze your income and expenditure.

National Foundation for Credit Counseling spokeswoman Gail Cunningham said she always asks for their customers, To reduce spending. If there is not enough to cut costs, she advised a second job to speed up debt repayment. This may require some sacrifices, but it can free you from debt in half the time.

Another useful information to first pay off all high interest credit cards and loans, and continue to work down the list.

Remember always what secured and unsecured debt is used in the decision to pay its debts in order first. Home mortgages are secured, the largestDebt that many Americans face.

First steps to zero debt

Nancy Register is Associate Director of the Consumer Federation of America in Washington and the director of America Saves. "Getting to zero debt is a wealth-building strategy, and a base of the America Saves program, she said.

Of course, the companies will hold their card with them from score card always at zero debt. Women register of the credit card company for the unprecedented consumerDebt in America today. Expect a flood of new credit card offers, if you start to pay off your debts.

Do not neglect your credit score

People with debt spinning helplessly caught in a downward spiral. "The higher the debt burden, the lower your credit score," said Douglas Heller, the executive director of Consumer Watchdog. "And the lower your credit score, the more you will pay for a loan." That said, Mr. Heller, "just makes it harderand get more difficult for people to get out of these holes. "

However, once you start your repayment of the debt, things are working positively to your page. Your credit rating can be improved with reduced debt and interest rates for the balance, which is easier to settle lower.

Heller warned that a method of debt reduction could hurt your credit rating, especially if you are negotiating for a lower balance. The creditors will be satisfied for less afraid, you can defaulttheir losses. If a creditor agrees to relieve a percentage of your debt, it will negatively impact your credit rating and can be bad in the long run.

If low-cost credit card offers in your mailbox, you can use them as bargaining chips tools to negotiate with your credit card provider for a lower rate because of improved adherence to the company for a long time, the credit rating. If your card provider refuses to provide a smaller amount, then you can signfor the new cards.

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