In a time when banks get trillions in bailouts and big businesses go to congress to beg for sweetheart loans, it is amazing that so many consumers are so reluctant to ask for credit counseling. This article reviews the most common signs that it really is time to ask for help.
You cannot pay your bills every month. You can pay your bills, but you pay them late each month, so every month there are new fees and your interest rate has climbed to over 20%. You can pay your bills, but you make new charges on credit cards each month to cover the household expenses (rent, mortgage, car payments, gas, etc) that you should pay from your income and not by incurring new debt. You have very high balances, very high interest rates, and you know that you will never get out of debt. You can forsee that you, or your spouse, will soon be out of work due to illness or job loss. You know that once that happens you will not be able to pay your bills. You can not afford to pay for health insurance while still making credit card payments, which means that if you get sick you’ll have devastating debt that will never be repaid.
If any of these things are true, you really should pick up the phone and start calling credit card counseling services. You can work with them to create a debt managment plan that will let you repay some of what you owe at much reduced interest rates. Acting sooner rather than later can help insure that you do not have to declare bankruptcy. It may ensure that your home will never end up in foreclosure.
Make sure that whoever you work with is accredited with the National Foundation for Credit Counseling or the Association of Independent Consumer Credit Counseling Agencies. Do not agree to pay any large upfront fees, and do ensure that you retain control over any funds used to pay your bills. Remember to continue to pay your bills until all your creditors have agreed to to the terms of any debt consolidation or debt repayment plan negotiated on your behalf.
Acting quickly can protect you and your family from the impact of runaway debt. Getting help sooner rather than later is the intelligent, responsible thing to do.
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