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7 Tips for Being a Successful Debt Negotiator

Here are two statistics that may surprise you.

  1. Households that have credit card debt have balancesserious worried man averaging $16,748
  2. Households that have any kind of debt have a total average of $134,603 in debt, including their mortgages.

Where do you stand?

If your family has more than $16,000 in credit card debt or more than $134,000 of total debt, the first thing you need to do is admit that you have a problem. Step two, of course, is figuring out what to do about it. This means you basically need to become your own debt negotiator. However, being your own debt negotiator can be complicated and requires a lot of fast thinking. Do you believe you have what it takes to be your own debt negotiator? If, so here are seven tips that can help you be successful.

1. Be prepared to pay some money up front. Many lenders will want at least 50% of your overall debt up front. In fact, some won’t even begin negotiating with you until they’ve received some money.

2. Don’t be surprised if you have to deal with an attorney. Most lenders have customer service reps or agents to handle their debt negotiations. However, at some point, you may see a lawyer involved that is representing one of your lenders. But there normally needs to be a large amount of money involved before you see a lawyer involved.

3. When you make payments to a creditor, use a money order. You might never have thought of it this way, but if you make a payment to a lender with a check, it will have all of your pertinent banking information. So, if you are sued, the lender will have a much easier time getting at the money in your account.

4. Try to have the debt reported as “paid in full.” The whole idea behind debt negotiation is to pay off a debt for less than you owe. This is possible because most lenders will settle for less so they can at least get something back. The way you want the debt reported to the credit bureaus is as “fully paid” or “paid in full.” The way you don’t want it reported is as “settled,” “settlement” or “settled for less than the full amount due.” That’s because if the debt is reported that way, it will have a very bad effect on your credit score.

5. Consider hiring an attorney. If a lender refuses to negotiate with you, or if it fails to live up to its promises, you may have to file suit. This means getting a lawyer involved to strengthen your position. You’ll need to spend money to hire a lawyer, but a good one could save you more than she or he costs.

6. Be realistic in your negotiating. The customer service rep you’ll be dealing with will be a very experienced negotiator. He or she may convince you to back down a bit and accept a payment that is still more than you can afford. Don’t let this happen. It’s a mistake to agree to any debt settlement that you can’t comfortably handle. Be honest. Let the other person know what you’re willing to pay. If that doesn’t work, pull out the big guns and threaten bankruptcy. This will generally get what you want because lenders understand that if you’re forced into bankruptcy, they won’t get anything.

7. Determine how far the lender will go. Remember the adage that once you name a number you can’t go higher, you can only go lower. Make your first offer a low one. You might be pleasantly surprised as the lender might accept it. Are you asking it to waive your payments for a few months? If it offers three months, ask for six. In other words, always ask for more than you think you can get. The worst that can happen is that you’ll get a no. The important thing is to always aim high, and to know how much room you have for negotiating within your budget.

In conclusion

If you think you have what it takes to negotiate your debts, then go for it. But, if at the end of 90 days, you haven’t been able to negotiate any debts successfully, it might be time to hire a debt settlement company.

Trapped in a Quagmire of Debt? Take This Tip to Get Out

疲れたビジネスマンIf you’re faced with an unmanageable amount of debt, It can affect you emotionally and physically. This is due to the stress related to dealing with those debts. A 2009 Associated Press/AOL health poll found that 27% of people stressing out over their debts had ulcers or digestive tract problems. A total of 44% reported they had migraines or other headaches, while 29% suffered from severe anxiety.

If you’re experiencing one of these physical problems, drugs probably won’t help. You need to get to the root of the problem, which is your debts.

Fortunately, a fairly simple path out of your debt exists. It’s called consumer credit counseling.

How to find a good credit counseling agency

Reputable credit counseling agencies generally belong to the National Foundation for Credit Counseling (NFCC) or the Financial Counseling Association of America (FCAA). Some are actually sponsored by local Better Business Bureaus.

How it works

Reputable, credit counseling agencies are nonprofits. If you go to one of these agencies, you will need to take your household budget (if you have one), and a list of your debts with each one’s interest rate. You will also need to take a list of the debts you are behind on, your assets and what you could sell them for.

The agency will assign you a trained and certified credit counselor who will go over all this information. She or he will review your budget to determine if it’s realistic, and may suggest improvements or additional cuts. Your counselor will also show you a realistic picture of where you stand financially and may suggest you revise your budget to generate more cash flow.

You could get a debt management plan

If your counselor finds that your finances are in really bad shape, he, or she may suggest you pay them off via a debt management plan (DMP. If this happens, he or she will explain how a DMP works and will discuss its pluses and minuses. You should also be given a general idea of how much you will be required to pay on your debts each month.

It will work with your lenders

Your counselor will figure out exactly how much you can afford to pay your unsecured creditors each month to eliminate your debts over a three- to five-year timeframe. She or he will then contact your lenders to see if they will agree to let you pay those amounts. Your counselor will likely ask your lenders for other concessions like lowering your interest rates, and waiving or reducing any fees you owe.

Before signing off on your DMP

When your counselor has prepared the final version of your debt management plan, be sure to get a copy. Don’t sign your DMP until you have read it very carefully, understand it all, and are sure you can live up to it.

Paying the credit counseling agency

Once you sign off on your DMP, you will be required to pay the credit counseling agency each month, and it will then distribute the appropriate amounts of money to your lenders. You will get regular monthly updates as to the status of your DMP, and this should include confirmation that your creditors were all paid per the terms of your plan.

What consumer credit counseling agencies cost

The advice and counsel you’ll get from your credit counselor will be free. However, if you sign up for a debt management plan, the agency may charge you a small monthly fee of $25 or $35 to administer your plan. Or, it may do it free. This varies among credit counseling agencies. Be sure to ask if you will be charged anything to administer your plan before you sign off on it.

Alternatives to consumer credit counseling

Good alternatives to consumer credit counseling exist but whether they would make sense will depend on your financial situation. For example, if most or all of your debt is credit card debts, you might consolidate them by transferring all of their balances to a new card with a lower interest rate. Or, if you qualify, you could transfer them to a 0% interest balance transfer card, where you would have as many as 18 months interest-free.

Other options for debt consolidation include a home equity loan and a homeowner equity line of credit. Of course, you would need to have equity in your home to qualify for either of these loans.

Debt settlement

Finally, there is the alternative of debt settlement. It’s grown a lot in popularity as it represents the only way to pay off debts for less than what you owe. The trustworthy debt settlement firms such as National Debt Relief are usually able to get debts cut by as much as 50% or even 60%. Of course, they are for-profit firms and charge for their services. However, if you owe more than $10,000, then using a debt settlement firm could still save you money.

The Best Debt Management Tips of 2017

Being deeply in debt can skew your entire financial life. If your problem with debt becomes serious enough, it will affect your credit score. In turn, this can mean higher interest rates, higher insurance premiums, and even problems renting a house or apartment. What debt amounts to is borrowing from your future self, and your future self could end up being very disgusted with you due to all that debt you now have to pay off.

Ignoring your debts won’t make them go away any more than ignoring a bad tooth will make it go away. You need to take steps now to do a better job of managing your debts, and here are eight tips that could help.

1. Pay down your debts soonerAdult Woman

The easiest way to get out of debt is to pay down your debts quicker. Are you making just the minimum payments on your credit card debts or other revolving debts? Try doubling down on as many of them as you can, or at least paying significantly more than the minimum. In addition, if you pay half your monthly bill every two weeks, you’ll be making one extra payment over a year, which will help you pay off that debt sooner.

2. Set up automatic payments

You should be able to set up automatic bill pay through your bank. If not, you will need to go to your individual lenders, and arrange automatic payments through them. Automatic bill paying accomplishes two things. First, it eliminates the possibility of missing a payment. And second, it relieves you of the burden of having to remember when your payments are due.

3. Make a budget

Trying to manage your finances without a budget is like trying to assemble an IKEA desk without the instructions. You may get the job done but only by luck. If you truly want to do a better job of managing your finances, you need to create a budget or at least a spending plan. One of the simplest ways to budget is to divide your net income into three categories. The first should be your essential expenses (think utilities, rent, or mortgage payment, etc.). This should be 40% of your net income. The next 30% should be your savings. The final 30% is for your discretionary spending or the fun things in life.

4. Pay off the debt with the lowest balance

This is called the snowball method. The financial guru Dave Ramsey introduced it.. The psychology behind this is that you should be able to pay off the debt with the lowest balance very quickly. This will give you momentum (as well as more money) to pay off the debt with the second lowest balance, and so on. It’s like how a snowball rolling downhill gathers momentum.

5. Understand your limits

Maxing out your credit limits can do serious damage to your credit score. Keep the balances on your credit cards as low as possible. If you can keep their total below 30% of the total amount of credit you have available, your credit score will improve. And, of course, always make your payments on time.

6. Check your credit reports

You can get your credit reports free once a year from the credit reporting bureaus – TransUnion, Experian, and Equifax. Or you could get all three simultaneously on the site www.annualcreditreport.com. The reason to keep an eye on your credit reports is to spot errors that could be dragging down your credit score. Many people choose to get a free credit report every four months. This is a way to kind of monitor credit year-round, without having to pay a credit monitoring service.

7. Create an emergency fund

You can never know when you’ll run into a financial emergency, but you can bet you’ll have one. You could lose your job, your automobile could require an expensive repair, or you could suffer a serious illness. The only way to buffer yourself against one of these emergencies is to have an emergency fund. While many experts feel your fund should be the equivalent of six months’ of your living expenses, most people find this undoable. If you fall into this category, try for at least three months’ worth.

8. Stop using your credit cards

Unless you’re paying off your balances at the end of every month, using your credit cards means piling on more debt. So, stop using them. Try to pay cash for all your purchases. If you don’t have enough cash to pay for something, don’t buy it. We understand that takes a serious amount of self-control, but it’s the only way to keep from adding on debt. When you stop using your credit cards be sure continue making your monthly payments, This will improve your credit utilization rate, and will help your credit score.

In summary

Here were eight tips that could help you better manage your debts. If you don’t feel you can implement all of them this month, at least pick a couple and try to use them. Doing something is better than doing nothing – especially when it comes to your debts.

7. Simple Tips For Cutting Your Healthcare Costs

happy-young-man-with-fixed-car-300x199Even though the bill that would have replaced the Affordable Healthcare Act failed to pass Congress, there’s still a great deal of uncertainty about what the future holds. The Republicans may introduce a new version of their bill, or they may not. Health care insurers are threatening to pull out of the insurance exchanges in some areas. There may not be much you can do about all this, but you can make some simple changes in your lifestyle that will save you lots of money. We’re sure you’ve heard the old faithful’s if stop smoking, eat less, and exercise more. But beyond these, there are some lesser-known things that you could do that will reduce your spending on healthcare. Here are seven of them.

1. Get a pet

Yes, seriously get a pet. It’s best to get a dog because a dog will require daily walking. And walking daily can help you lower your blood pressure, fight stress, and get you out exercising regularly. In addition, when you’re out walking regularly, you can make new friends and extend your social circle. The experts say that walking just 30 minutes a day could help you lose as much as 00 pounds a month – if that’s important to you.

2. Become a volunteer

Believe it or not, it’s been pretty well proven that altruism reduces the risk of dying early. In fact, according to one study, volunteering seems to “buffer” the effects that can be caused by a stressful situation.

3. Move to a cheaper market

This one’s a bit radical but there may be cheaper healthcare markets besides where you live. A study done in 2014, and reported by Kaiser Health News, found that Colorado ski resort towns, the Connecticut suburbs of New york Cty, and the rural regions of Mississippis, Georgia, and Nevada, topped the list for being the most expensive for healthcare. Parts of Minnesota and northwestern Pennsylvania are among the least expensive. This is apparently because they have a relatively low cost of living to begin with, plus plenty of competition among hospitals and doctors. Other areas good for low-cost health insurance include  Tucson and Hawaii.

Colorado ski resort towns, the Connecticut suburbs of New York City or a bunch of otherwise low-cost rural regions of Georgia, Mississippi and Nevada, you have the misfortune of living in the most expensive insurance marketplaces under the new health law.

4. Turn off that TV

There have been a number of studies showing that for both adults and children, the more TV they watch, the higher their obesity rates. In addition, to a higher risk of type 2 diabetes for adults that watch a lot of television. This could be hard to believe but it’s also been found that cutting back on TV has actually helped people lose weight.

5. Add folic acid to your grocery list

According to the Disease Control Priorities Network at the University of Washington, there’s considerable evidence that if you take multivitamins with folic acid, you’ll reduce the risk of developing many different cancers.

6. Forget that annual checkup

Here’s something else that will seem counter intuitive. There isn’t much evidence that going to your doctor every year for a checkup leads to a longer life or better health outcomes. For that matter, there are a number of professional organizations that don’t recommend this practice any more. A yearly exam can lead to tests that come back with false positives, which can mean unnecessary follow-up tests and even procedures. Plus, these checkups can be expensive. If you don’t have a chronic condition or are sick, then going to see your doctor for an exam every two or three years should be sufficient.

7. Get a second opinion

Unfortunately, a considerable amount of research exists that showing that doctors often recommend and perform procedures that cost a lot, are invasive and painful, and don’t accomplish much. As an example of this, the New York Times reported recently that surgery for many conditions having to do with back pain yield modest benefits. As another example, ProPublica did an investigation that found that “stints for stable patients prevent zero heart attacks and extend the lives of patients a grand total of not at all.”

You might also get a second opinion if your doctor says you need to go on a medication indefinitely. The fact is that a diet or lifestyle change a could be a better answer. Do you take a cholesterol-lowering drug called a statin? A considerable amount of debate has been held in the medical community as to whether this actually does anything to improve health. However, there is absolutely no debate over the benefits of using diet and exercise to lower your cholesterol naturally.

In conclusion

If you’re concerned about the cost of your healthcare, relax. As you have read, there are six simple things you could do that would help you Improve your health, which will mean lower healthcare costs. And best of all, they either cost very little or nothing.

Four Signs You Have a Serious Problem with Debt

serious worried manHave you thought much about your debt lately? The thing about debt is that it can creep up on you. You charge a couple of lunches here, a new coat there, and then an overnight stay at a nice hotel. You haven’t paid any attention to what these charges are doing to your total debt. Why not continue to ignore it?. After all, what you don’t know can’t hurt you, right?

Wrong.

Trying to ignore your debt is like trying to ignore your shirttail relations. Neither is going to go away and in the case of debt, things are only going to get worse.

Are you in serious trouble with debt?, Here are the signs to look for.

Your debts are growing

If your debts are not shrinking, the odds are they’re growing. As painful as it might be, you need to add them up, and then compare this total with where you were A month ago and two months ago. If you find your debts are increasing, there’s one simple reason. Your spending more than you earn. Fortunately, there’s an easy fix for this. You need to either find ways to increase your income, or you need to reduce your spending.

You’re getting hit with late payment fees

Late payment fees mean you’re not paying your bills on time. This is a sure sign that you’re having a problem with debt, plus it’s costing you money. Let’s say you’re being charged a late fee of $25 on your credit card payments. While that may not seem like much, it can add up over time. Get more than 180 days behind on a payment and you’ll be in default. The odds are that your lender will then sell your debt to a collection agency, which is something you definitely don’t want to have happen.

You have a “bad” credit score

Have you checked your credit score recently? If not, you absolutely need to. You can get your score free on-site such as CreditKarma.com or CreditSesame.com. You could also get it from one of the three credit reporting bureaus – Experian, TransUnion, and Equifax. If you find your score is below 600, you have at best a “poor” credit score. This is costing you money in the form of higher interest rates and higher insurance premiums. It’s also a big sign you’re having a problem with debt.

You live from paycheck to paycheck

When you’re two or three days away from a paycheck, do you wonder if you have enough money left in your bank account for a drive-through latte? Do you have to postpone having lunch with a friend because you’re close to flat broke? This means you’re living from paycheck to paycheck, and that’s never a good thing. It’s not only a sign you’re having a serious problem with debt, but it’s also just no way to live.

What happens if you pay off your debt?

Paying off your debt can be an amazing stress reliever. For that matter, the stress related to dealing with your debts can actually cause you to experience physical problems.

When you pay off your debt, you’ll no longer be required to pay interest fees and late charges. A second important benefit is that this frees up your future income. Whether you’ve thought of it this way are not, when you create debt you’re borrowing money from your future self. Stop running up debt, and you’ll have more money in the future and probably a better life.

Once you get your debt paid off, you should be able to use the money you now have to create an emergency fund. Most experts say your fund should be the equivalent of six months’ living expenses. However, that’s just not doable for most people. Try for three months of your net income instead. If even this seems out of reach, try to save at least $1000. Do this and you’ll have money available to help in the event you become ill, lose your job, or the transmission in your car falls out.

Finally, when you pay off your debt, you’ll have money to invest or to save for retirement. If your company’ offers 401(k), be sure to participate. If not, open either a traditional or Roth IRA and start socking money into it. If you have money left over after this, invest it in something safe like a low-cost index fund, and then never touch it.

In summary

If you find you are seriously in debt, you need to go to work and get rid of it. It’s not only the best thing you can do for your future self, it’s an easy way to get a raise without having to wait for your employer to give you one.