3 Simple Steps to Finding Debt Relief That Actually Works
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You’ve seen just how much debt you’re in, and you’re ready to get serious about it. No matter how far behind on payments you are, you can always recover your finances.
To start, debt relief can be simplified to three steps:
- Pulling Credit Score
- Organizing the debt of all accounts
- Choosing a payment path
Pulling Credit Score
Knowing your score will help you get the best setup possible with a debt relief service. A quick and free way to pull your credit score is to use our calculator at LendingTree, where you can sign up to get your score in minutes.
Organizing Your Debt
Divide your debts into secured (i.e. monthly rent payments) vs unsecured (i.e. hospital bills). Focus first on the secured debts as paying those means you’ll get to keep your assets. Of your total unsecured assets, add them up and if your unsecured debts are equal to more than half your gross income, it’s time to choose a path to payment.
Choosing a Payment Path
You’ve either realized that with adjustments to your monthly spending you can pay off your unsecured debts in 3 – 5 years, or that there is no hope of repaying unsecured debts in that time despite taking hard cuts to your budget. At this point, debt relief services may be your best bet.
How the services function is that they take all your debt accounts and convert them to a single monthly payment (usually at a significantly lower interest rate) by giving you a loan themselves. It also sets a date at which you will be free of the debt – normally 3 or 5 years (depending on your selection). Doing this could boost credit score too by reducing your “revolving credit utilization rate.”
For this route, we’ve assessed the top reputable Debt Relief services for you to check out here.