We have appox $50,000 in revolving debt, 2 vehicle payments, 1st and second mtg, we pay everything on time and have a small amount left over each month, but feel everything closing in and have fear starting to come over me about all of the debt.
Is there any way to get some help even if we are paying on time ….without ruining our credit?
Yes, there is a way to get out of debt and improve your credit at the same time. The only problem is, it’s hard to do and requires perseverance.
The issue you are facing right now is that it feels like the walls are closing in. At times like that people often leap to solutions like credit counseling or debt settlement that they think will be quick and painless fixes, they are not.
You do have a lot of debt and now is the time to start to dig your way out. By making at least the minimum payments on your debts and then using whatever money you may be able to find as an extra monthly payment you can start your journey to eliminating your debt.
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By paying down your debt with at least monthly minimum payments while focusing on eliminating one debt at a time your payment history on your credit report will show that you met your contractual obligations, were on time and not delinquent at all. All those factors will continue to increase your credit score and you reduce your debt.
It sounds to me like your debt to income ratio is pretty high, meaning that most of your income is pledged to debt repayments. That makes it harder to do a balance transfer of your highest interest rate debt to pay that one off interest free. That approach is wonderful as long as you can completely pay off the transferred balance before the introductory rate expires. I just wrote about my own recent experience in doing a balance transfer.
You can also easily adopt the debt snowball approach for effective emotional and financial debt reduction. It is an approach that works, and works well.
The key here is that you need to trust your instincts. Your subconscious is telling you, through fear and worry, that your financial life is out of balance. You should listen to to those warnings but there is no need to panic, just make a choice on which path you will follow to get out of debt and execute that plan.
If you feel like you just can’t do it on your own then look at a credit counseling program, it will screw up your credit but by sending one payment to them every month they will then take care of distributing your payment to your creditors.
But you really don’t need a credit counseling program at the moment since you can do this yourself and by doing so it will achieve your goal of getting out of debt and not harming your credit report or reducing your credit score.
There is hope.
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