Debt Counsellors And Consolidating Debt
Perhaps you have found yourself slipping so seriously into debt that you needed to approach a debt counsellor to help you sort out the problem. This, they will no doubt do for you. They have vast experience and they know exactly how to handle your problems. You just need to follow their leadership. They may decide to consolidate your debts into one package and you will have to pay an affordable amount off monthly or weekly, until your finances are under control again. Or they may give you advice, help you to work out a budget for your day to day living, and show you the best ways to spend the least amount of interest. Your life is slowly coming back under your control again. Now you have to face the next question. How to prevent it ever happening again?

There is only one rule that should guide you. Your expenditure must never exceed your income. This sounds so simple. The problem is that unexpected expenditures crop up in life that you have to handle. So you take out a loan to pay it off long term. Then another unforeseen event of expenses comes up and you need something elseand you do it again. I dont need to tell you. Youve already been there.

You will probably be on a strict budget still, and when your credit loosens up, you will be faced with the enormous temptation to relax and ease the pain of doing with budgeting. Dont yield to it! Lock your credit cards away, or even cut them up. Close your store credit accounts and save the fees you are paying monthly to keep them open. By this time you will be in the habit of paying off fixed monthly accounts, such as your house mortgage, school and medical expenses, car payments and utility bills. After this you set aside for your food and living expenses, and stick strictly to that budget. Now, whatever is left over, is what you have to work really carefully and shrewdly with. Your best bet is for you and your family to make a list of everything each member needs and wants and prioritise this list. Set each item down in order of importance. Now sit down together and, with common sense and a lot of sensitivity, meld these lists until you come up with a family priority list that each member feels happy about and is prepared to stick to.

One of the first things on your list should be to start building up a reserve fund. Even if this is really a tiny weekly or monthly amount, dont ever be tempted to use that amount for anything else at all. This should be kept for absolute emergencies, not for that bargain you saw at the store, that you are sure you wont get again! This amount is untouchable. If you are brutally honest with yourself, you will know when a real emergency justifies spending it. As soon as you are in a position to, put aside another similar amount, and also keep it sacred. The difference is that you should take this money, say, once a year and treat yourself and your family with it. Splash out and have fun. If you do this you will find that the stringent measures you take during the rest of the year to keep your budget under control will be easier to bear. Besides, if you can control your finances, you deserve the reward!

This is the VOA Special English Economics Report, from voaspecialenglish.com Dubai’s recent debt problems have brought attention to the growth of Islamic finance. A government-owned group of companies, Dubai World, has been seeking to restructure twenty-six billion dollars of debt. About six billion of it is in Islamic bonds, including a three and a half billion dollar bond set for repayment in December. The biggest difference between Western and Islamic finance involves beliefs about charging interest on borrowed money. In Islam, the basic idea is that you should not make money from money itself. Instead of interest, lenders charge fees. Ghiyath Nakshbendi at American University in Washington is an expert on Islamic financing. He says “The bank will estimate its costs based on its fixed costs, variable costs, the cost of their employees, the rent and so on and so forth. And from that they estimate how much they are going to charge. But he points out that this system can make Islamic financing costly. The costs of the system are shared by the borrowers. The fewer the borrowers, the more each has to pay. In many cases, Islamic financing requires the lender and borrower to share profits and losses. Ghiyath Nakshbendi explains what that means with Islamic bonds, called sukuk. He says the bondholders are buying a share of a business or property. If business is good, then they could get back more than they expected. But if it fails, then there is no guarantee of repayment …

Choosing To Eliminate Credit Card Debt
Is there a simple way to eliminate credit card debt? Despite the fact that there are no magic switch solutions that will bring overnight results, the process of eliminating credit card debt does not need to be exceedingly difficult either. One of the keys to finding a long term resolution to your debt problem is having the proper attitude. Without a proper attitude, the actions you take to address your situation will fall short of their intended results. Proper mindset begins with the desire to change. That desire has to be concrete and cannot be undermined by spur of the moment impulsive actions. If you are unwilling to adopt this frame of mind and internalize this desire, then no debt elimination option is going to be effective for you.

After you have determined deep within that there is no turning back from the process, you will be ready to begin taking action. Following through requires daily discipline from you. The place to begin is the development of a household financial plan. Sit down with a notepad, a calculator and any other decision maker in your household. Pull out all of your bills and your bank record. Start by listing your monthly take home income. You then will need to list all payments that are due monthly. This not only includes your unsecured credit card debt, but it also includes utilities, car payments, mortgage and other billable expenses. Once those things are listed, you should list the basic household needs such as food, clothing, medical care, fuel and insurance.

If the total of the expenses is larger than the level of monthly income received, you must formulate a plan to scale back your expenses. This is why the attitude is so critical. If you have not made a concrete commitment to cut down your unsecured credit card debt, you are extremley unlikely to make the sacrifices necessary to balance your household budget and your debt problem will continue to grow. When looking to make reductions in your household budget, the first place to look is the non-necessity items in your expenditures. This might include such things as dining out, leisure, magazine subscriptions and cable television. These reductions are made until the debt burden is removed from the budget. Once these items have been exhausted, the next place of modification is in the fixed expenditures. This may include such severe steps as the sale of an automobile or the downsizing of a home. Again the goal is to remove the level of indebtedness.

As soon as your budget is adjusted to the point that a surplus is generated, that excess needs to be placed upon your outstanding credit card balances. The extra should initially be directed towards the card with the highest Interest rate. When that card is paid off, then direct the funds you had been paying toward that card onto the card with the next highest APR. Continue this process until all of your cards are at a zero balance. If you have not already done so, cut up your cards, so that you are not tempted to use them again. Should the problem be at a point that you are unable to resolve it by yourself, you might look into other possibilities provided by outside sources. These would include things like consumer credit counseling and credit card litigation.

The steps to eliminate credit card debt require dedication and commitment. If you will take these steps, this process does not have to be complicated, plus the freedom of being free of debt will be worth the effort.

More Credit Card Debt Articles

Debt Counsellors And Consolidating Debt
Perhaps you have found yourself slipping so seriously into debt that you needed to approach a debt counsellor to help you sort out the problem. This, they will no doubt do for you. They have vast experience and they know exactly how to handle your problems. You just need to follow their leadership. They may decide to consolidate your debts into one package and you will have to pay an affordable amount off monthly or weekly, until your finances are under control again. Or they may give you advice, help you to work out a budget for your day to day living, and show you the best ways to spend the least amount of interest. Your life is slowly coming back under your control again. Now you have to face the next question. How to prevent it ever happening again?

There is only one rule that should guide you. Your expenditure must never exceed your income. This sounds so simple. The problem is that unexpected expenditures crop up in life that you have to handle. So you take out a loan to pay it off long term. Then another unforeseen event of expenses comes up and you need something elseand you do it again. I dont need to tell you. Youve already been there.

You will probably be on a strict budget still, and when your credit loosens up, you will be faced with the enormous temptation to relax and ease the pain of doing with budgeting. Dont yield to it! Lock your credit cards away, or even cut them up. Close your store credit accounts and save the fees you are paying monthly to keep them open. By this time you will be in the habit of paying off fixed monthly accounts, such as your house mortgage, school and medical expenses, car payments and utility bills. After this you set aside for your food and living expenses, and stick strictly to that budget. Now, whatever is left over, is what you have to work really carefully and shrewdly with. Your best bet is for you and your family to make a list of everything each member needs and wants and prioritise this list. Set each item down in order of importance. Now sit down together and, with common sense and a lot of sensitivity, meld these lists until you come up with a family priority list that each member feels happy about and is prepared to stick to.

One of the first things on your list should be to start building up a reserve fund. Even if this is really a tiny weekly or monthly amount, dont ever be tempted to use that amount for anything else at all. This should be kept for absolute emergencies, not for that bargain you saw at the store, that you are sure you wont get again! This amount is untouchable. If you are brutally honest with yourself, you will know when a real emergency justifies spending it. As soon as you are in a position to, put aside another similar amount, and also keep it sacred. The difference is that you should take this money, say, once a year and treat yourself and your family with it. Splash out and have fun. If you do this you will find that the stringent measures you take during the rest of the year to keep your budget under control will be easier to bear. Besides, if you can control your finances, you deserve the reward!

Contrary to what many people believe, not all debts are dischargeable regardless of your bankruptcy filing options. For debts like student loans and mortgages, a debtor must enter into some type of repayment agreement rather than have these debts completely discharged. In many cases, the court will appoint a trustee to liquidate your assets so the proceeds can be used to repay your creditors. The courts have established these guidelines as a way of preventing abuse and harm to society.

Bankruptcy filing does not solve all of a debtor’s financial problems. Courts have deemed that debts which could be harmful or unproductive to the nature of society are non-dischargeable in a typical bankruptcy. The idea behind this is so that people cannot relinquish their obligations to pay child support, alimony, and other money that contributes to the good of society. This idea of non-dischargeable debts also spreads to student loans because of the amount of money granted by the government each year for college educations. Student loans are possibly the most difficult types of loans to get discharged through bankruptcy. Until recently, they were covered under the types of debt that were dischargeable under loan bankruptcy guidelines, but recent amendments to the code have changed this.

In terms of bankruptcy, business filings are often forced into a plan to repay the business’s creditors. The bankruptcy courts often see completely discharging the debts of a business as detrimental to society because of the ramifications involved. With a Chapter 7 bankruptcy, business assets are typically liquidated and the company shuts down. This results in a loss of jobs that help to pump money into the economy. This is why businesses are often forced into a Chapter 11 bankruptcy because their debts can be reorganized and the creditors can be paid in installments while the business continues to operate.

For people who have fallen behind on car payments or home mortgage payments, bankruptcy filing can grant a temporary protection from their creditors. Chapter 13 is designed in such a way that homeowners or consumers with other types of secured debts can retain their property even if they have fallen behind in the payments. The debtor makes arrangements with their court-appointed trustee to make payments along with extra money to help them catch up on missed payments with this type of bankruptcy. Mortgage companies are willing to work with debtors because they would rather afford them some leeway rather than go through the trouble of court proceedings involved with foreclosures.

Mortgages are not impossible to get after bankruptcy. With manual underwriting, many companies will work with your particular case to help you achieve your home buying goals. Even though debtors who go through Chapter 13 are favored, those who have filed Chapter 7 can also be eligible depending on the circumstances surrounding their bankruptcy and their current financial situation.

Bankruptcy can change a person’s life. While it offers temporary protection from the legal actions of creditors, the effects of a bankruptcy filing can haunt you for the rest of your life. One problem is that many debts that cause a person to get into financial trouble cannot be discharged. Financially, you are subject to years of higher interest rates and stricter payment schedules.

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But why do I hear so often that only time can fix my credit? Because that’s what the credit bureaus want you to believe. They’ve even got the media believing their hype. But all their billions can’t change the fact that credit repair is real and it can work for you.

What’s the big deal about fixing my credit? How much difference could it make? According to the latest figures, the average American has a credit score of 677. If that same individual’s credit score rose to just 720, that family could save on average $421 per month, or $5,052 per year on house payments, car payments, credit cards, etc. Over 20 years, that’s more than $100,000! And if your score is lower than 677, then you have even more to gain.

For more information about the benefits of fixing your credit, click below: The 10 Most Common Myths About Credit Repair and the Truths that Expose Them

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Only about a quarter of these… Read more…