Tip For DIY Debt Consolidation

You may feel that DIY debt consolidation is right for you if you are struggling with your multiple debts and are determined to pay those off and pull yourself out of the debt trap. However, it is important to weigh your options on a right scale and consider all the factors so that in the end you are sure that you do not relay require the assistance of a professional debt consolidation company. (Image Credit: Pixabay)

It is important for you to understand exactly what the requirements are for a DIY debt consolidation and then make your choice. The following three contributing factors will help you to determine whether or not you are financially and mentally ready to take the challenge face on:

• The objective: You must be very objective about your spending. For this you will have to pinpoint where exactly your money goes to every month. This is a critical step to follow as this will help you to devise a more realistic budget. Such a budget will help you to free up your money that is required to pay off your debt. Apart from that, you must also be willing to analyze every single expense that you make so as to determine on what you have been spending. This precise analysis will help you to find out how much of a deficit is created every month. This approach will eventually enable you to determine the expenses that you can curtail so that you can end up creating a surplus fund that you can funnel directly towards paying your debts off.
• Willingness to negotiate: You must be willing and ready to call up your creditors to negotiate a deal and also know the ways in which you can negotiate with success. In most of the cases you will see that a proper negotiation will help you to reduce most of the high interest credit cards that is making it difficult for you to pay off the debt. Negotiating just like a professional debt consolidation company to consolidate the credit card balances into one loan of lump payment carrying a lower interest rate will take you a long way in attaining a debt free future. Therefore, find out someone with authority in the credit card companies to discuss matters and arrange for a more favorable loan conditions and terms.
• Diligence: It is required that you are diligent in your approach and stick to a specific debt pay off plan. You must have a strong willingness to stop using your credit cards further so that you do not take on new debts. You must be realistic and honest with yourself. Remember, with a DIY debt consolidation approach, you are on your own and will have no one expect you to blame or lean on when anything goes wrong and you make the situation worse.

All these factors will help you to prevent taking on new loans and pay off the existing ones easily. When you pay off your debts all on your own it will give you a highly satisfying feeling and you can use this experience in the future to prevent yourself from being in similar situation. However, it will take proper planning, diligence and real commitment.

Tips for success

DIY debt consolidations can be really difficult to be successful especially if you have less than fair credit or owe high balances in your credit cards. In such situations you will need to find out expert tips and helps from sites such as nationaldebtrelief.com or others. However, if you think DIY debt consolidation is right for you then these are the secrets to its success. These tips will help you to pay off credit card debts easily by yourself and be successful.

DIY debt consolidation typically have its unique features namely, dedication, results and relief in that order. For this you will need to:

• First, list each of the account balance along with its APR or Annual Percentage Rate that usually includes rates of interest as well as other finance charges. These charges are expressed as an annual percentage of the entire balance owed.
• Second, take note of the minimum payment due amount as well as the due date. This will help you to set up automatic payments for each loan several days ahead of the specified due date.
• Find the loans that carry highest APR and make sure that you pay of the most you can in these balances. Make sure that you do not overlook or skip your other loans and continue making the minimum payments for each.
• When the highest APR debt is paid off, pat yourself on the back but make sure that you use this amount saved toward paying the next highest APR debt. Repeat this process till the time all your debts are finally paid off.
• Make the best use of technology when you schedule automatic payments online. This will ensure that no payment is missed and you avoid the penalty fees.

Design a precise spreadsheet using any one of the many available online to track your progress. Make sure that the sheet shows each account balance by entering the falling balance after you receive a new statement.

Word of caution

Yes, there are a few precautions that you must take during your DIY debt consolidation endeavor. To start with, be informed that there is nothing wrong in celebrating and congratulate yourself after paying off each debt considering it to be a milestone that you have achieved in your path to attain financial independence. It is good to encourage yourself for staying on track.

However, you must avoid over celebrating and rushing to the mall to buy the designer watch that you longed for with you credit card once again. Instead, have patience and wait till the time all you loans are paid off. Make sure that you:

• Cut up using your cards to reduce your impulsive buying
• Do not close your accounts as it will reduce your available credit and credit scores.

You can do this all to improve your quality of life.

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