Warning Signs That You Need Help Managing Your Debt
With most Americans carrying some sort of debt, it has become the norm to have a slew of monthly minimum payments to keep up with. But before it becomes increasingly difficult to meet each of those obligations, there are several signs to look out for that may indicate you’re in over your head. Read on for our top signs you need debt management help, because the sooner you take care of those loans, the better it will be for your future, both personally and financially.
You can’t keep up with monthly payments
Falling behind on your monthly payments is a debt trap that is best to avoid if at all possible. When struggling with debt, one of the first signs that you might need debt help is when you can’t pay all of your monthly minimums. This is a slippery slope to larger credit problems because your credit score will be hugely impacted if you have any missed payments that are reported to the credit bureaus. Rather than hoping for a sudden windfall of money to pay down your debt, think about getting help early to avoid future complications.
Worry keeps you up at night
Everyone has some type of worry in their life, but if you constantly go to bed thinking about your credit card debt or other bills, it may be time to get help with debt. Rather than losing sleep every night, think of how much better you’ll feel knowing that you have a debt management plan to get your finances back on track. A simple phone call can provide you with a huge amount of comfort, and more importantly, proactive steps to reshape your finances.
You have minimal savings
If you already have trouble staying out of debt, you’re setting yourself up for even more problems if you don’t keep any money in savings. When your next major financial setback occurs, whether it be car problems or loss of a job, you may have few choices but to charge up more credit cards, continuing the debt cycle in your life. It can be a bad sign when high credit card debt is compounded by little savings. Get ahead of the game now by considering financial debt help.
You’ve been denied loans or credit cards
Another sign you might need debt help is if you have recently been denied a loan or credit card on one or more occasions. This indicates that your credit score has dropped and that lenders view you as a credit risk. If you’re already struggling with debt, it’s probably best not to take out any additional lines of credit so that you can get approved and take advantage of prime interest rates when you actually need them. The earlier you find debt solutions that work for your financial situation, the sooner you can get your credit score headed in the right direction.
Debt keeps growing
It’s hard to work on staying out of debt if it keeps accumulating. Whether you simply don’t earn enough to keep on top of your basic expenses, or you’ve developed a costly habit of spending outside your means, you may need debt help to keep your finances from further spiraling out of control. A trained financial professional can help you create a budget that works for your finances, as well as offer you additional debt help services like debt settlement or consolidation.
Your debt-to-income ratio is above 43%
Most mortgage lenders require a debt-to-income ratio of below 43% in order to qualify a potential borrower for a home loan. Even if you already own your home or don’t plan on buying one anytime soon, this is a good litmus test to see where your debt stands in relation to your income. To calculate this number, first add up all of your monthly debts. Next, divide that number by your monthly gross income – that’s the amount you earn before taxes, retirement, health insurance, and other deductions come out. If the number you get is over 43% then you might want to seek out some debt advice on how to lower your debt so that it falls within a more manageable percentage.
You have one or more credit cards go into default
Perhaps the most telling sign that you need help with debt management is if one or more of your loans has gone into default. This means that you’ve likely missed a payment for 180 days or more and the credit card company has closed your account. Next, they’ll likely sell your account to a debt collection agency. Loan defaults of any kind can carry serious consequences to your financial future for years to come, so this is a time where it is particularly important to get help with debt.
Debt collectors call constantly
It’s hard to find peace at home when you are constantly interrupted by debt collectors calling you on the phone. It might be easy to feel bullied or guilted into rash decisions by some of these aggressive callers, but it doesn’t have to be that way. Getting help with debt is one way of alleviating this burden. You’ll not only learn about your rights when it comes to debt collectors, you can also have someone work on your behalf to deal with collections agencies, depending on your needs.
Find help today
If one or more of these signs apply to your debt situation, consider reaching out for professional help. There’s no harm in making an introductory phone call to assess your options and you’ll feel better knowing you are taking charge of your debt, rather than feeling overwhelmed by it.