Useful Debt Assistance Tricks For Paying Less Interest On Your Debt
Posted on May 29th, 2010 in Debt Assistance | No Comments »
photo credit: Lin Pernille ♥ Photography
If you want to get out of debt as quickly as possible (and let’s be honest, who doesn’t?!) then a topic worthy of consideration is that of interest payments on the money you owe. The higher the interest rate you are paying, the longer it will take you to pay off your debt and the more money it will take.
Luckily though there are a number of ways in which you can reduce your interest payments if you know what you’re doing which can make paying off your debt far easier.
Negotiate With Your Creditors
If your debts are in good standing then you may have some leeway with your existing creditors. A quick phone call to them with a request to reduce your interest rate may be met with some success if your creditors can clearly see you have been keeping up with your payments and are a reliable borrower.
However if I’m totally honest with you this really isn’t in the best interests of your creditors. After all, why would they consider accepting less money from you than they could actually get?
And there is one reason that can really hold out. And that is debt flipping.
Flip Your Debt
If you have a high interest rate on a debt, as is often found with credit card debt, it can be a smart move to consider taking out a lower interest loan and using this to pay off your higher interest debts. In this way you will be able to pay off your debt faster.
Some credit cards also offer a 0% interest deal for a period of time and so taking out one of these cards and then transferring credit card debt from higher interest cards onto the new interest-free card can be another quick and easy way to reduce your interest payments and pay off your debts faster.
Sometimes when calling creditors about reducing or even halting your interest payments for a period of time, explaining that you are considering doing this can be enough to convince your existing creditors to help you. While flipping your debt can be helpful, it also requires some effort. And so ringing your existing creditors and explaining that you are considering such a thing can really motivate them to look at your interest payments. After all, the longer you stay with them, the more money they will make from you.
Consolidate Your Debt
You need to be careful with debt consolidation and ensure you fully understand exactly what you’re getting yourself into before signing any agreements but again rolling all your high-interest debts up into one low-interest debt consolidation loan can make sense for some people and allow them to focus on just paying off one manageable debt rather than dozens of debts that only seem to grow each month no matter how much money you pay into them.
