i'm in about 40,000 dollar in debt, and falling behind on all my payments, how do i get out?

Answer 1

The first thing you need to do (and any financial advisor will tell you this) is sit down and make a budget.

What bills do you have each month? When are they do? What do you usually get paid? etc.

Use this to figure out if you have income that could be re-allocated to afford your debts. Are you eating out? Are you going out to the movies, bars, etc? Stop doing these things. Eat at home and find cheaper ways to entertain yourself at home.

Decrease costs by lessening your services. If you have highspeed internet consider downgrading to a lower speed. If you use a cell phone don't keep your house phone. If you use cable, make sure it's basic and not upgraded. Think of all the changes of this nature you can make to decrease your cost of living.

Additionally, call your creditors. If the debt is a student loan seek deferrment or forebearance. If it is some other type of loan seek refinancing options but make sure there is no penalty for refinancing your current loans. If it is a car loan you can often skip a payment as long as you have had several months good payment history (my bank it's 9 months).

If it is credit card debit, determine if it would be better to move your payment date to meet your paycheck needs. Call to ask if you can have your interest rate lowered.

Once you do all these things, sit down and rehash that budget I mentioned first.

This next suggestion is just from my experience in talking with people that have unexplainable trouble with their finances. Stop writing checks. Use your debit card whenever you can (hopefully your bank posts the debits as soon as their made like mine does). For bills, don't have them on auto payments unless you get a discount for it. This way you can control when the debits will come from your account. Lastly, use a web bill pay service so you have a reasonable expectation of when debits will come out of your account. Using checks is simply the worst thing you can do when you are on a tight budget.

Kudos to you for jumping on this problem early and before it's way too late. Good luck!

Answer 2

I would call each creditor and see if you can get a payment plan set up by them. Call each one individually and see what you can do to resolve it.

They'll probably offer some solutions. Stay away from credit counseling, as it's just a mistake for so many different reasons.

The bottom line is you need to pay on time, and get to a point where you aren't paying interest only. Maybe refinance your home and stack the debt on top of the house if you're a homeowner. Maybe ask for a loan from family...and then you'll at least be in the clear from creditors.

Learn more about credit:

http://www.thetruthaboutcreditcards.com

Answer 3

If this is a mortgage on a house or a car loan, sell the asset.

If this is all credit card debt --- wellll--- you're going to have to bite the bullet big time, get credit counseling, communicate with each lender, get on a payment plan, cut up ALL of your credit cards and go on a cash-only basis, severely cut back on your spending, adopt a more spartan lifestyle, and maybe even take a second job. The alternative is bankruptcy and a miserable credit rating that will stick around for years. You don't want that.

Answer 4

Once you start falling behind, you will likely never catch up without a windfall of extra income. What's worse is that now your credit score is dropping which will eliminate the possibility of getting relief through a home equity loan.

You should go see a credit counselor immediately. They can frequently get your payments reduced and help you get lower interest rates, all while eliminating late penalties. They can only help you do this when the debt is with the original creditors. Collection agencies do not offer these benefits, so you must get help before it is too late.

Answer 5

depending on your financial situation now. If you are really at the end of the road, file bankruptcy, but that will hurt your credit a lot.

However, if you can live without filing bankruptcy. do the following.

1. cut spending.- You are not like government who can keep taxing people, you will have no choice but cut spending to adjust your income.

2. Additional income - 2nd job would help

3. consolidate all debt in one and pay them monthly instead of scatter all over. Find a better loan company who can consolidate for you. In that sense, you may be able to pay little porton every month until paying off

4. if you own a house, re-finance, that way you can have extra cash to pay off this $40,000 debt

Good luck!

Answer 6

A lot of ansers above; most will not solve your problem. If you are a homeowner, I may have a solution. You could payoff all your debts for about 50 cents on the dollar via debt settlement ( you are probably wondering where the money would come from).....in conjunction with a cash-out refinance of the home. I can recommend multiple companies that specialize in both. Email me for more info. Good luck!

Answer 7

Try targeting the highest interest rate debts first, see if you can open a dialogue with them and come to some arrangement about managing the repayments. these people would rather you pay off the debt slowly and completely rather than go to court.
A cop out is to declare bankruptcy but this is detrimental to your credit rating. Speak to the companies, work out a budget and make them an offer.

Answer 8

Get with a credit counseling company, one that does not ask for money, get a copy of your credit report, so you will have an idea of where you are at. start paying all of the little bills off completely, your current basic bills, pay them completely each month, call up some of the people that you owe and they will work with you and cut you some slack in some cases.

Answer 9

All the answers above will probable help, but I am in a company that I know personally many people were in serious debt and now they are financially doing better than they ever had before. I would like to show you how it works, you can contact me at bowenquarterhorsesandpaints@ya.

Answer 10

move to studio apt, get rid of the car and get a simple A to B car, cut up all credit cards, sell off all you can on ebay/pawn shops, and most important...STOP SPENDING.

to be in debt shows you are living beyond your means, quit living a lie and fall into place where you belong. then and only then will you actually be happy.