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5 Tips to Follow When You Are Deep in Debt

By: alphafinance0 comments

Sometimes, you just find yourself in a situation you could have otherwise lived without. For example, crippling debt. Once you realise that you’re under pressure to pay the money you owe, you begin to feel a lot of anxiety and confusion as to where and how you should start.

Well, the first thing you need to do is stay calm long enough to figure out that there is a way for you to get out of this. But you need to work on it. So, to help you, here are a few tips you can follow when you are deep in debt.

Reach out to your credit provider

You know what they say, honesty is the best policy. Which is why it is essential to reach out to your credit provider and fill them in on what’s happening with your life. Be honest with them and explain how your current living situation is preventing you from making the agreed payments.

Your credit provider can then offer you some advice on the situation or even give you other options regarding repayments like smaller payments each month or a different payment plan that can cater to your needs.

Seek help from a financial counsellor

Now, if advice from your credit provider is not possible, you can then choose the help of a financial counsellor. Luckily, there are organisations that offer this service for free, so you don’t have to worry about needing to pay any professional fees that you might incur. You just need to find one in your area that you feel comfortable enough to talk to.

Talk to a legal adviser

If things get too out of hand, to the point that banks and other creditors have enough case for them to take it to the constitutional court, seek the help of a legal adviser.

Just like with financial advice, you can find legal assistance in Australia that is offered for free. No worries of adding to your debt and sinking you deeper into your debt hole.

Consider an application for a Hardship Variation

There are cases wherein the person falls into debt after falling ill, losing a job or any other life challenges that just seem utterly unfair. If this is how you got into debt, you may be eligible for a Hardship Variation.

A Hardship Variation can help you come up with a viable solution as you try to figure out what to do next while you continue to recover from your illness, or while you try to find a new job in the meantime.

Change your repayment method

In line with the life change, you may not be a fit with your current payment method anymore. If that is the case, consider changing your repayment method to suit your situation better so you can still make your payments more comfortably, while still being able to afford your groceries and other things you need to pay for.

This should be one of the things you talk about with your credit provider when you come to see him about your current situation.

Any or all of these tips can work for you, but it also depends on your current situation. So, assess yourself and try to figure out which of these tips is best suited for your needs.

Now, while you’re deep in debt, and find yourself in need of a vehicle to get to your job but can’t afford it at the moment, consider getting a car lease. It can help you in two ways: provide a way for you to get to work on time, and help you rebuild your bad credit by making the car payments on time every time.

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