Knowing that you are not the only one swimming in debt is very little comfort when you can not see a way out. The best thing that you can do is try to develop a plan to get out of that debt. Here are five strategies that you should avoid at all costs.
- Avoid paying the minimum payment on your unsecured debts(credit cards, medical bills, etc). Paying the minimum will keep you current, but will allow the debt to increase since you will not be addressing the full interest and principal.
- Avoid borrowing from friends and family. In general, this damages the relationships with the most important people in your life.
- Do not use Texas credit counselors that demand cash upfront, or high fees for their services.
- Avoid borrowing more money to pay off old debts, especially high-interest loans to pay off lower interest rate loans. It may seem wise to consolidate loans into one payment, but you are just extending the payoff time and increasing your overall debt load.
- Avoid declaring bankruptcy. Bankruptcy can have permanent and severe consequences on your financial future.
What you can do is talk to your spouse or significant other. Talk about looking into debt settlement. Yes, debt settlement in Texas is rough on your credit score, but it will recover. Do not use a debt settlement company that requires a huge upfront payment. Most only get paid after a settlement is reached with your creditors. Take your time and find the company that is right for you.