Check Credit Score / Credit Score Information / Credit Articles / Large Purchases / Repaying Your Debt
Repaying Your Debt
Posted: October, 2015
When you borrow something from a friend then you try and make sure you return that item because you want your friend to trust you. This type action speaks to your good character.
The same thing applies to your character when you borrow money from a bank or other lending institution where you don't really know the lender personally like a close friend.
How you repay that debt speaks to what kind of person you are. You won't have the person to person impact that you would have with a close friend but your actions will be reflected to other lenders in the way of your credit scores.
If you repay your debt on time according to the terms agreed upon then your credit rating will be positively impacted. If you don't then it will be negatively impacted.
Getting Out of Debt Plan
If you stop and think for a moment you will realize that digging yourself into a hole of financial debt will be some very stressful times for you.
However, if you are already feeling this stress because of your current debt, do not be discouraged, there is a way out. You can do a lot yourself to get yourself out of your financial crisis.
You might contact your debtors and ask for a deferment until you can get yourself caught up on some other debt or maybe get a job if you happened to have lost your job.
You might could get a new loan with which to help you keep the current debt payments current while you get a job or otherwise do something about your income. Maybe you take on a second job for a while and use that money for paying off old debt, and nothing else.
See Exactly Where You Stand
Most people don't have a good handle on their debt because they never pause to write it all down in one place and survey where they really stand. You can do something as simple as getting a blank piece of paper and listing everyone you owe money too and how much. You don't need a sophisticated piece of accounting software, or even an excel spreadsheet. However, using something like an excel spreadsheet might make it easier to keep updated as you go along.
Getting It All Paid Off
Once you know how much you owe look at what it will take to pay off the lowest amount. You will need to make extra payments, not just the minimum payment amount. Find that extra twenty or fifty dollars in your monthly budget and apply it toward this one debt until you have it paid off. You might have a yard sale or a bake sale and take that money and put it toward this debt.
Maybe take on a second job or learn how to earn some money via the internet in order to have extra money to put toward your debt.
If, for whatever reason, you just don't have enough in your monthly budget to make all your monthly payments then you might want to consider consolidating some of your debt in order to reduce the total monthly payment amount that you owe.
This will not, however, get you out of debt and it should not give you license to go out and acquire more debt, say on that credit card that you freed up when you did your consolidation.
You will still need to find ways to pay extra on your debt until it is paid off completely. It can be done. Others do it every day and so can you. It just takes focus and determination, both of which you are capable of.