Tricks for paying down debt with or without personal bankruptcy

There are numerous people living in Cherry Hill who are just barely scraping it by financially. These individuals are particularly vulnerable to debt problems. If an illness that involves costly medical bills surfaces, or some other kind of financial emergency occurs, these individuals may be tempted to use credit cards to get through the financial problem. Once credit card debt begins to snowball out of control, though, it can be very difficult to climb out of it again. This is where personal bankruptcy may be particularly useful -- to get a fresh start, regain one's financial bearings and simply live again.

However, other strategies could be useful for those who are still on the line with debt problems. One solution that might work for some involves a systematic plan for paying off one's credit cards. Commonly referred to as the snowball method, this plan involves paying down one credit card at a time. Once the first card is paid off, the monthly payment being made on that card can be combined with the monthly payments being paid on the next card and so on, until all the debt has been paid.

During the process of employing the snowball method, another technique that can be implemented at the same time involves lowering one's debt-to-credit ratio. Debt-to-credit ratio is the relationship between the amounts of debt a person has against the amounts that are available to him or her on active credit cards. A bad debt-to-credit figure will ruin a person's credit score and commonly occurs when numerous maxed-out credit cards are present. Many people may wish to focus on paying the cards that have the worst debt-to-credit ratios first (i.e. maxed-out or close to maxed-out cards) because this can cause a fast and dramatic improvement to their credit ratings.

These are just a few examples of techniques available, which do not involve personal bankruptcy. However, for numerous Cherry Hill residents, personal bankruptcy can represent their best solution for eliminating heavy debt fast. Regardless of the method employed to resolve debt issues (whether it be bankruptcy or a debt management plan), the process of eliminating one's debts can be an extremely freeing and liberating experience.

Source: money.usnews.com, "How to Pay Down Credit Cards to Boost Your Credit Score", Abby Hayes, May 11, 2014

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