Along with credit cards, another thing that can get you in debts is automobiles. Car Dealerships make a lot more money from financing your purchase than they make from you buying their cars. But guess who pays for it?You do! You pay considerably more than what you would pay for any other kind of borrowing. You are not only paying the interest on the purchase but the insurance, warranty and all the other things the dealer talked you into while buying the vehicle.
Trouble with Debt
All the costs mentioned above make for a very expensive car and before you know it, you will be having trouble paying the monthly installments. So, this might mean you have to sell your high priced vehicle and get into something more realistic considering the situation that you are in. You need to look in more categorically and find a solution for the debt. You can try to decrease other loans such as student loans and housing loans. Get into a smaller house or get yourself a more affordable car.
Being Realistic With Your Purchase
Cars are often an emotional buy.Thinking of your friends and family’s reactions can often lead to a more expensive purchase. You need to look into your situation more realistically and think about cutting costs wherever possible. It can make your daily routine very hard. If you have two cars instead of one, it can be of great help to sell one of the cars and settle your debt. It will leave you with more cash in hand plus a car for yourself. If you want to sell your expensive car and get a cheaper one, you can also do that and have some money to get out of your debt and have a more economical car.
Debt Settlement and More
While you deal with the purchase and selling of vehicles, you can also do a few other things. Debt settlement is making your lenders agree to adjust your debts so that you can pay them. There are debt settlement companies which can help you with same. Firstly you set aside a sum of money every month and get yourself a lawyer you will negotiate with the creditors. This process can take 2 to 4 years and will negatively influence your credit.You can also undergo credit card help to assist you with the settling of debts.
Debt Consolidation and more
Debt consolidation is the process of reducing the amount of your loan and getting a loan to pay for the same. The goal of consolidation is that you have to pay at lower interest rates, and the amount payable is less. Another thing you can do is undergo a debt management program. Here you will meet a financial advisor, and the company manager will try to talk to your creditors to lower the interest rates on your loan. It will not have an adverse impact on your creditors but may limit your credit during the duration of the program.You can file for bankruptcy, but that is to be looked at as the last resort.It will affect your credit negatively for many years.Here, you officially declare that you cannot pay your debts and undergo a process.