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Credit solutions: Your guide to avoiding bad debts



Credit Solutions are effective ways to get out of debt or a bad credit situation that can jeopardize your credit score and your credit worthiness in the eyes of your creditors.

Credit solutions…. tackle 3 credit problems you often face, these are:

  1. Too many credit cards: When you have multiple credit cards, you try to transfer balances from one card to another instead of decreasing an individual account. This way, each of your cards has a high balance that does not decrease creating a problem.
  2. Late or missed payments for loans or credit cards: Continual late payments hurt your borrowing capacity and your lenders lower your credit worthiness from the pattern of your late payments.
  3. Too much ….outstanding debt: If you have a disproportional high debts compared to your income, you can risk getting into a tricky credit situation. This might also frighten future lenders from offering you loans.

How credit solutions work in a bad credit situation



You can find 6 different credit solutions that work well ….bad debt situations. The brief outline of each is given below:

  • Be frugal in your lifestyle: If you want to get back to sound finances, pay off your interests on your debts every month, (full stop) it’s important that you curtail your daily spending habits. Being “dollar-wise” will better your bad credit situation and in future, boost your borrowing credibility. For instance, you can attempt to scale back your buying plans, (semicolon) this way your creditors will be assured of your loan- repayment capacity.
  • Cut down your spending: Do not use your credit cards unless you have emergencies. Find inexpensive ways of spending that don’t burn a hole in your pocket.
  • Prioritize debt elimination: Make debt repayment a priority every month before anything else. Focus on paying off your smaller debts, and then turn your attention to paying off the bigger debts.
  • Arrange for an emergency fund: Create an emergency fund only for repaying debts. This will help you make timely payment each month to your creditors.
  • Save cash, avoid impulse buying: This is the most important credit solution that helps you on rainy days. Avoid impulsive buying and then putting the purchases on your credit card. Get into the habit of buying later which helps you to save on cash.
  • Stay away from credit card debt: Avoid using credit cards for every purchase just because they are convenient for online purchases or traveling, use a debit card instead. This simply helps you solve your credit problems and lets you stay in good financial shape.

Benefits of credit solutions
  • Credit solutions help you regain control of your finances and remain debt-free in the future.
  • You take good financial decisions and retain the habit of saving.
  • You automatically stop falling prey to subprime lenders who charge high interest rates.
  • With these practices, lenders will stop calling you a debt defaulter and enhance your chances of receiving a new loan.
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