How To Get Out Of Personal Debt

Personal debts can see your hard earned money vanishing without you even realizing it. This happens, simply because of over-spending. Having said that, how can this be controlled.

Credit Cards

Credit cards, whilst having their own advantages, give people a sense of false wealth. Banks give maximum amounts you can use every month letting you think you have that amount to use up. If you use the credit card for all your purchases, you may have the tendency to spend more that you should. Think carefully before you swipe that card. Remember that for every swipe there is an added amount of interest hiding there somewhere. Use your credit card only for big things, meaning those that are high priced. Or use it only for items that have been budgeted for.

Always get zero interest rates and discounts your credit card company offers. If they do not have zero interest rates settle for the lowest interest fees.

Limit yourself to having one or two credit cards. By doing this, you limit yourself in spending too. That would definitely reduce the upper limit of your spending, and control your personal credit card debt.

Loans
Loans are useful and good if used wisely. If you are a wise spender you will use it to your advantage. Always remember to get the lowest interest fees or better the one with zero interest rates. Look carefully into the installment plans. Be sure you can pay for that specific amount every month. If not go for a plan with longer plans. Look into these interest rates as well. Be sure you pay your loans before its due date. You will incur late charges if your payments are late. This way, you can also control your personal loan debt.

Shopaholic
Do not go after every sale in town. Are you saving by buying during the sales or just merely spending more? Or do you buy almost every item that looks good? Limit your spending to planned purchases.

The Lose Change
Save the coins which are part of the change returned to you. It may look little but over a period of time, this can add up to quite a bit. If you do not like carrying the coins around, then just drop them into any container, that you can keep for this purpose. Once you save a good amount, you can get the bank to exchange them for bills.

You might find times that you might actually find that you can put this savings to some good use.

Emergencies
Make sure you have some emergency funds. You never know when you will need it. If you do not have this, then you will end up having to use your credit card or getting a loan.

Planning your spending based on your income will help more than anything else to ensure that you do not get into personal debt. Besides staying out of debt, also start saving. Plan for the future. Think of the reasons you will need the savings in the future. This will motivate you to not only stay out of personal debt but also to save.

How To Get Out Of Personal Debt

If you owe a lot of money, you’re probably worried about a debt collector suing you for not paying them. But did you realize that there are actually many reasons for which you can sue them instead?

Keeping in mind that I’m not a lawyer, and am not giving any legal advice whatsoever, here are the facts:

The Fair Debt Collection Practices Act, also known as the FDCPA, defines specific practices in which debt collectors may not engage. According to the FDCPA, you have the right to sue a collector in a State or Federal court if they engage in any of these forbidden practices.

So, what are these forbidden practices?

The first of these forbidden practices is harassment. Harassment is defined by the FDCPA as the annoying somebody by making repeated telephone calls, using “threats of violence or harm”, or the use of obscene language.

The second forbidden practice is using false statements to collect on a debt. The FDCPA prevents debt collectors from telling lies in order to collect on a debt. This includes falsely presenting themselves as government agents or attorneys, lying about how much is owed, or claiming that your inability to repay your debt makes you a criminal. Debt collections agents have a long history of being dishonest if it makes them easier to collect on a debt.

Debt collectors also may not make public the fact that you owe a debt. This includes contacting other people about your debt, publishing a list of names of people who have outstanding debts, or contacting you via postcard. The only instance in which a debt collection agency can contact other people about your debt is in order to find out your current address, phone number, or place of employment.

So, what happens to a debt collector if they break the rules and engage in one of these forbidden practices?

If this happens, you should first inform the debt collections agent that you know your rights under the FDCPA, and that they have to stop their illegal actions. Nine out of ten times, this will fix the problem without you having to use legal action.

If that doesn’t do the trick, however, you still have up to a year from the time they violated the FDCPA to sue the debt collector in state or Federal court. You are allowed to sue them for any demonstrable damages that you suffered because of their illegal practices, such as lost wages or medical bills.

Even if you can’t prove that they caused any actual damages, the judge can still require that they pay you up to $1000. In addition, the judge can require them to reimburse you for your attorney fees.

Remember that just because the debt collections agent broke the law while trying to collect money from you, it doesn’t mean that the debt disappears. If you still owe the debt, you still have to pay the debt. The only difference is that their breaking the law means that you can sue them under the FDCPA.

Know the law. Know your rights. And if your rights are violated under law, make sure you use the law to enforce your rights.