Good Money Management Is The Only Way Out Of Debt
Establishing a budget, keeping on track with it and keeping record of all of your expenses is the real solution for rebuilding and repairing your credit once it has been damaged. Don’t be tempted to file for bankruptcy; you will only ruin your chances for the future. Even the solution of a debt consolidation loan will only add more and continued debt burden. You have to pay interest on the loan, and you will just be worried about making it until it is finally paid off. The best solution is to save your way out of debt. It is a much better idea to keep track of your expenses so you know what you are spending your money on and then you can eliminate unnecessary expenses and start to save.
A small first investment you might want to make is a software program that will assist you in budgeting and saving. By making it easier to keep track of things, this small expenditure will save you a lot in the long run. The first thing you need to do is establish a budget. A software program will ask you all the questions you need to establish a budget. By answering the questions, the program will put all of your income and expenses in the correct categories and show you what you have left over. You can also do this on your own, by using a form where you write all of your income on one side and all of your expenses on the other. Each week write down what you spend on each item, how much you put in your savings account or retirement fund, taxes, etc. Record your earnings and track how much you have left. If you see that each week you have nothing left to pay an essential bill, you will have to change your payment system. Each week as you pay your bills, try to make as large a payment as you can on each of your necessary bills, such as rent or mortgage, electric, water, phone, etc. Then you have to survive on what is left by cutting back on non-essentials. You may have to stop going to the movies for a while and just rent inexpensive ones from the library. You may have to cut back eating out. Next, examine all of your essential bills to see how you can save money there. If you start to limit the phone calls your family makes, if you make sure to turn off lights and stop wasting water, you can probably save a lot of money. Making these cutbacks and sacrifices will pay off big if you can catch up on all of your bills. You will not even remember which movies you missed while you were putting money away to pay off all of your bills.
Another way to handle this problem is to make a survival budget. What is the absolute minimum you and your family need to survive on? Cut every expense down to its lowest, like budget meals every night, no entertainment except whatever is free, basic water, basic T.V. cable, basic telephone. Follow this survival budget for a few months and you will be shocked at how much extra you will have to pay off your bills and debts. Certain items are important to keep up, such as health insurance and your rent or mortgage, so you don’t end up with no roof over your head or medical bills you can’t pay. But everywhere you can cut back, you should. Any savings can be applied to catch up on bills or debt.
The other side of the equation to look at is your income side. Can you ask for a raise, or can you find a better paying job, or perhaps you can find a second job? Find any way you can (any honest way, that is!) to increase your income while you cut down on your expenses, and you will repair your credit before you know it.
Peter J. Wilson
http://www.articlesbase.com/finance-articles/good-money-management-is-the-only-way-out-of-debt-98274.html
What do I do if the debt management company doesn't make a payment for me on time? Can I sue them?
In early 2006, I signed up with a company to consolidate my credit card debt. The full amount was around $12,000, and that’s spread out over six cards.
This year I started making a good bit more money, so, in May, I called the debt management company and asked if they’d take an EXTRA payment from me that month, as soon as possible, in order to knock off most of the debt on two credit cards.
I thought I was clear and repetitive, but somehow they managed to ONLY pay those two cards that month of May and none of the others.
Now Bank of America has told me that this has been negatively reported to the credit bureau.
The debt management company, who made the error, is telling me, in so many words, that it’s my fault and that there’s nothing they can do. They tell me to call Bank of America, while Bank of America just shrugs and says, "We just report what comes in and what doesn’t."
I asked for a call back from a supervisor at the debt management company, but there’s been none since I started asking last week.
I threatened to sue them, and they told me, in so many words, that that is not an option.
Can someone make a mistake that injures your credit rating and not be held accountable? I never missed a payment until now.
most likely part of your contract had an arbitration agreement that said you agreed not to sue them, but if you had a dispute, you would arbitrate. so, be prepared to fly to the city that the loan company’s corporate office is in, pay $2,000-$3,000 for you share of the arbitration fee, tell the arbitrator your side of the story, listen to the loan company tell their side, and see what the arbitrator decides (which is unappealable and legally binding). but keep in mind, you are the out of towner and the arbitrator pays the bills by arbitrating for the loan company, so whose side do you think he or she is on. sorry but your hosed
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There responsible and they better fix that mess they made with Bank of America for you. There is what’s called the New Uniform Debt – Managment Services Act. Basically what has happened to you has happened to many other people and worse. You can report them to the Federal Trade Commission to begin an investigation. If they find they committed any wrong the FTC will take care of it for you. For the record next time you want to change the terms of your agreement with anybody make sure to do it in writing and send it certified mail. They can always say they never spoke to you. You can definitely take them to court but try the FTC first.
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Your relationship with the debt management company is controlled by the contract that you signed with them. I would have to see the contract to tell you more, but most of these contracts have an arbitration provision. This means that when you signed the contract you likely agreed that you would not sue them, but would instead submit the dispute to arbitration. The bigger issue here is one of damages. Until you have been denied credit due to the late payment being reported on your credit report, you have limited damages to prove up in a lawsuit. Adam Fullman
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