- Part 1 – Recognizing Your Debt Problem and Obtaining Your Credit Report
- Part 2 – Acting on Your Credit Reports
- Part 3 – How To Understand Your Credit Files
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Believe it or not, one of the best tools you can use to repair your credit is your own mind and your own senses. Stop getting into more debt and use your mind to think about what you are doing. Use your eyes to see and your ears to listen and pay attention to your surroundings. What are you using your debt for? Is it necessary? Do you really need to borrow to get into more debt? Remember that these activities can adversely affect your credit report.

In Part 4 of this series on “How To Repair Your Credit” you will discover the advantages as well as the disadvantages you will have as being a debtor.

Do you know what can happen when you have bad credit?

Do you know how to protect yourself from creditors and collection agencies?

It’s not just creditors and collection agencies you need to beware of. It’s the Internal Revenue Service, the IRS. If you are obligated to pay child support, or income tax the IRS can deduct your entire refund in order to repay your debt if you are in default. This can also happen with college tuitions you never paid. The good part is that, at least the IRS must contact you before they can deduct any fees from your tax refunds.

Get rid of collection agencies, call today

If you miss payments on Insurance Policies and you have conditions stipulated on that policy, you may be at risk of loosing your property.

If you still have any utility bills that are not paid up, most states, under the law, cannot just automatically cut service. This mostly applies to necessary utilities such as heat and electricity, especially during cold winter months. When they do disconnect service most of these states are required to give you prior notice.

This will buy you some time to find the funds you need to pay your utilities. Some insurance policies will also provide for a grace period for you to catch up with your payments. The time allowed for you to catch up with these payments is when you need to stop, think and listen. Use your senses and your mind. These are very powerful tools for you to use in helping you repair your credit. Use that time to review your bills and the amount of funds you have available to pay those debts. If need be, concede to the fact that you will be short of cash in the near future to allow you to contact your creditors.

Reviewing the amount of funds you have will also help you allocate your payments more responsibly. Remember that paying something is still better than nothing.

If one of your creditors happen to write off one of your debts, you may still be required to pay taxes on that bill. If they do decide to write that bill off, it is is sent to the IRS for review and if they choose to do so, you will still pay on that bill at the end of the year.

So…when you receive that first letter in the mail and your lender or other creditor asks you to pay your bill, write them back and politely explain your situation. Don’t forget to ask them for a possible extension on your payments. Most creditors still want you to be a returning customer, so they will try to help you if think that you are just suffering a temporary setback.

Keeping your creditors on the same side as you is always the best strategy and will help to ease any future complications. It still helps to keep them on your side by sending them what payments you can afford on your current overdue bills. Although the next bill will be higher, sending in minimal payments will still keep you in their good graces until you are able to catch up…and you will still avoid being flagged by the credit bureaus.

On the other hand, some creditors just don’t want to be on your side. They may want you to send in your payment immediately. In this case you may want to consider disregarding them as they are not doing you any favors except to add a further burden to your debt load. If you do have enough money to pay a bill, tell the creditor and send them the money immediately. Do not waste money on services that just charge you to send a bill.

Debt Counselors:

No! Not everybody is nice. There will always be creditors that just will not help you. If your creditor will not allow you the opportunity to extend your debt or they ask for proof of your situation, then it may be time for you to consider contacting a Debt Counselor. Debt Counselors work on your behalf. Yes, your Debt Counselor is on your side. They will do whatever they can to resolve your debt issues.

As mentioned in the above paragraph, debt counselors are on your side, so do not go against them or lie to them. Arguing with them and using foul language certainly will not help. If you had more than enough time to pay a bill, then DO NOT contact your creditor or collection agency. All this does is ring alarms and will just flag you as a risk. Let a Debt Counselor help you instead.

Use your mind and senses that were given to you. These are extremely powerful tools. When you set your mind to it, you will find the right solution to help you get out of debt. Understanding all the steps necessary to help you pay off your debts and to repair your credit does not have to be hard at all. You just have to take it step by step.

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Filed under: Credit Repair

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