The first issue to consider when your debt get on top of you is to face the reality and work out the size of the problem. We often know where the problem lies whether it is with our overspent credit cards, our increasing bank overdraft or the large personal loan we recently acquired. No matter what the reason for your money problems you need to find a solution now. Start by going through your bank and credit card statements and any bills to find out how much you owe.
1. Draw up a list of money that you have coming in and the money you have going out each month. Make another list of the amount you owe each of your creditors for your credit cards, loans, and bank account.
2. You should now have a true reflection of the state of your finances and you can start setting yourself a realistic budget for the months and year ahead. Do not decide on a budget that you know will not work as this will certainly lead you to failure. A debt problem tackled early is a debt problem solved.
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3. Check your credit report. This is your personal credit history of your finances, from credit cards and loans to mobile contracts. It provides you with a profile of your repayment history and who you owe money to. You will see how you're coping with your finances as it lists the payments made and the payments you have missed along with any defaults, arrears or CCJ's (County Court Judgments) you have incurred. When did you last check your credit report is in good health? To see your credit report for free for a 30-day trial from FreeCreditScore. Always know what's up (or down) with your Credit Score with smarter alerts, Check your Score FREE!
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4. Take a long, hard look at your spending and find ways to save. If you have any Insurance policies, broadband contracts, telephone accounts, Gas and electricity accounts then you should be using price comparison websites to find the cheapest and the best value for money deals around. Price comparison sites provide an easy solution to reduce your household bills. Consider other cut back on everyday spending by making packed lunches, walking or cycling to work and braving the office coffee machine.
5. Cash-back websites offer you money back if you use their websites to obtain a product. But, only use them if they offer you real saving after you have checked with the price comparison websites for the best deal. Remember Price Comparison sites are biased to the companies that they recommend as they are paid for their recommendations. This site really pays!
6. Increase your chances of getting a low-interest rate deals for your mortgage or a loan by improving your credit rating. lenders use the information from our credit report to access the interest rate that they offer you. Lenders base their lending interest rates on how risky they feel lending you money will be.
7. Never miss, skip or delay a monthly payment to a finance lenders - the evidence stays on your credit file for three years and gives lenders the impression that you are unreliable. If you are having trouble finding the money, then always talk to your finance lender as soon as possible and see if you can negotiate terms you can afford.
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