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How Do You Get Help With a Loan or Debt Management?
There is a variety of ways to get help managing debt or loans.
It is all too easy when a problem occurs to try and ignore it, to pretend it isn't
there until it becomes an unmanageable issue. It is also easy to fall into the fallacy
of thinking that bankers, loan officers, and the like don't understand that unavoidable
events can happen. Don't allow yourself to fall into either of these traps. If something
happens that will severely alter your financial situation—a layoff, natural disaster,
healthy problem, etc.--call your lender and credit cards. Even if you have a financial
“cushion” as financial experts recommend, letting these people know now, before
it becomes a possible issue, is a good idea. Thanks largely to laws and regulations,
it is typically cheaper for a lender to work with a debtor than to repossess a house
or car. Thus, they are usually willing to work with debtors to help them through
rougher times. This is less likely to occur in credit card debt, but with loans
it is extremely probable. Most lending institutions actually have organized systems
for dealing with debtors who have run into financial trouble.
Do your homework
If your situation is severe enough that you can't manage on your own, you may need
professional debt management. This is not a decision that should be made quickly,
however. Finding a debt management or counseling company to work with should be
treated much like refinancing your home would. Get recommendations, do research,
and ask the company questions before making your decision. If you've been communicating
with your lender, s/he may have suggestions for companies to go to. Otherwise, check
with Better Business Bureaus, online, and speak to the companies yourself. You will
want to know your debt load, the ratio of your debt to your income, your credit
rating, interest rates, creditors, etc., before researching this. Fees of a few
hundred dollars up-front are typical. Avoid groups or emails claiming total debt
elimination in a short time frame, or those asking for large payments to be returned
after the debt are paid off. Legitimate debt consolidation groups will tell you
that there is no “quick fix” to large-scale debt problems. What they can do is work
with both you and your creditors to create payment plans that you can both live
with. It will often take years to pay off the debt, and even more to get it off
your credit report.
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