The first and foremost aim is to repay all outstanding debts as early as possible while being charge the lowest possible APR (annual percentage rate). Here we will discuss about the active steps towards cutting the cost of your debts.
- Check all credit references – At the onset, you need to understand your capability to get new and cheap credit not hampered by duff data on your credit files as this may cause rejection. In worst case scenario, if you apply before your credit is being corrected; all applications made by you can be rejected even after the problem is fixed. So check your credit reports first for possible errors.
- Shift to cheaper credit card debts – While used correctly and in a disciplined way, credit cards are the wisest way of borrowing, especially if you’re shifting debts to a new ‘balance transfer’ offer. You can get long term balance transfer borrowing facility on a credit card for zero percent. Have no worry, even if you credit score is not so good. You can still avail attainable deals.
- Cut credit card costs – This can be done even without a new credit. Many credit cards permit existing users to switch other debts to them at attractive rates. You can make substantial savings if this can be done in the correct order.
- Look for grants – There are a number of utility companies that provide customers with help in case they have huge arrears on electricity, gas and water bills. Whether you live in Cincinnati or any of the rent houses in Vijayawada, you have to pay your utility bills under any circumstance. All you have to be a customer of that company so that even yours is not listed; you can contact them to check whether they have a similar scheme.
- Use savings for repayment – The interest you get paid on savings is much less than the interest you’re being charged on borrowing. So it would be good if you pay a debt with your savings. After main debt switching step, you should try to pay off debts as much as possible with savings provided you should always focus on outstanding high interest debts.
- Avoid minimum credit card repayments – How much you repay every month on your credit card debt is very crucial. Remember, minimum repayment schemes are made to keep customers locked in for years. So try to pay more every month.
If you can’t handle your debts even after trying above-mentioned steps, you may opt for debt counselling sessions. And get a better footing.