However, credit card debt could become a costly expense if you don’t take steps to repay your balance sooner rather than later. Let’s look at how you could get on top of your debts after Christmas and keep your finances in shape.

 Are you struggling with your debts?

Of course, your ‘Christmas debts’ aren’t necessarily the only debts you’ll be carrying – you might already owe money to multiple lenders. If you can no longer afford your agreed credit card repayments, agreeing a new affordable repayment plan should be a serious priority. For example, you could begin to make lower repayments at a realistic pace with a debt management plan – an informal agreement that your lenders may decide is the best way of getting back the money you owe them.

If you decide a debt management plan is the best approach to your debts, you could ask your unsecured lenders to accept monthly payments you can afford, ensuring that they fit around all your other essential costs (utilities, food, rent/mortgage, etc.). However, making smaller repayments over a longer period could end up being more costly overall (due to interest), unless your lenders agree to freeze interest on your unsecured debts.

You’d make your monthly repayments until you’ve repaid the total amount you owe, or until a change in your circumstances means you can start making your original repayments again.

Although making reduced payments will show up on your credit history for six years – which could make borrowing more money difficult in that time – it’s likely your credit rating will already have been affected if you’re in this kind of situation, since debt management is only suitable for people who can’t make their agreed repayments.

 Are you managing your debts well?

If you’re repaying your credit card debt relatively easily, you may want to consider making more than the minimum repayments. Getting out of debt faster like this could also save you quite a bit of money in interest payments, so it may be worth the extra money per month.

If you can’t afford to make more than your minimum payments, you might consider ways of boosting your budget to ‘overpay’ your debts, e.g. sell some old DVDs, cancel that gym membership you don’t use, or use discount vouchers when food shopping. Working your way towards becoming debt-free could be a New Year’s resolution that’s well worth sticking to!

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3. Save Yourself From The Debt Trap With Debt Relief

Fortunately, there are ways to combat your debt problems. You just have to take time and know how these solutions work. Debt relief options are targeted towards saving you from the seemingly inescapable debt trap. While each solution has its upside and downside, every approach aims the most benefit for debtors who want to end their financial troubles.

• Debt Consolidation. This option involves making a loan to pay off all other debts. This allows the debtor to make only one monthly payment, get lower interest rates, and manage debts easier.

• Credit Counseling. With this approach, credit counselors negotiate with your creditors and handle your debts for you. Additional interest and penalty fees can also be waived through credit counseling, and creditor calls are stopped.

• Debt Settlement. Your balances are reduced through debt settlement companies who settle with your creditors. Your monthly payments are put into a trust fund, which is then used to pay off your debts.

• Bankruptcy. Some debts are best solved by filing for bankruptcy. In Chapter 7, your assets are seized and sold to pay your creditors, but this ensures total elimination of debt. In Chapter 13, you must turn over your disposable income within three to five years to pay off all your debts.

Stop revolving debt from sinking you deeper into the debt trap. There are ways to save yourself from financial crisis. There is no easy way out but you can lessen the burden. Whether debt acquisition was your fault or not, the good thing is that you can get yourself out of debt. Know the debt relief solutions available to help you eliminate debt from your life. Having an informed choice would take you a step closer towards freedom from debt and a healthy financial life.

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2. Tackle That Debt Problem
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1. Review your financial situation:
When you are planning to pay off your debts then make sure that you review your financial situation so that you can take help of a proper debt relief method to eliminate your financial owes. You can easily analyze your problem when you review your financial situation.

Your primary task will be to prepare a list of the debts you owe to the creditors. Make sure that you prepare a list in descending order of the interest rate on each debt. Your next job is to prepare a list of your monthly expenses in order to create a monthly budget. You are required to restructure your budget plan if your expenses exceed your income. Budgeting can help you track your expenses so that you can save considerable amount of money to pay off the owed amount.

2. Negotiate with the creditors:
If you have incurred insurmountable amount of debt then you can negotiate with the creditors to lower the outstanding balance to make it affordable to pay off. You can hire professional debt arbitrators if you are unable to convince the creditors to settle your debts. The deft financial experts can negotiate with the creditors to make the outstanding balance affordable to pay off. When you settle your debts then you pay less than you actually owe to the creditors.

3. Try to increase your source of income if you are planning to pay off your debts. In order to pay off your post Christmas debts make sure that you increase your income. Here are a few ways you can earn money to pay off your debts effortlessly.

a. You can earn some easy cash by giving a room of your apartment or garage on rent.

b. You can utilize your flair for writing to earn few extra bucks and you use the money towards paying off the debts. You can take freelance writing work during your spare time to earn money. There might be many webmasters who might be looking for talented writers in order to improve their page content in order to develop their website. You can charge these webmsters after providing with your services.

c. Ebay is another site through which you can earn considerable amount of money. You are required to register for an eBay account in order to sell items on it. Make sure that you browse through the site to find out about things having high demand. Make a list of the things with a proper description of the products and upload a picture along with it. The product you will be selling on ebay should have a definite price at the end of the picture.

Therefore, these are the smart ways to eliminate your Christmas debts and attain a debt free life.

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3. Save Yourself From The Debt Trap With Debt Relief

The people who are struggling to pay off their debts were not contented with the changes made to the bankruptcy laws in 2005. The altered bankruptcy law can make the filing procedure difficult for the debtors. When the indebted consumers file bankruptcy, the credit card companies incur huge loss. The companies can’t retrieve the owed amount when the debtor files petition under chapter 7 bankruptcy.

Here are some of the changes made to the bankruptcy laws:

Eligibility criteria for Chapter 7 bankruptcy:

You will not qualify for chapter 7 bankruptcy if your income exceeds the state’s median income. Your chapter 7 bankruptcy petition will not be approved if you are able to pay more than $100 monthly. Therefore, people will not be able to file bankruptcy due to the changed law in spite of having insurmountable amount of debts. However they are forced when they are left with no other options, they are forced to file it. Nevertheless, with the change in the law, chapter 7 bankruptcy is no longer a feasible option for people to file chapter 7 bankruptcy.

Know about the changes in Chapter 13 bankruptcy law:

If you file chapter 13 Bankruptcy, your disposable income is used to wipe off your debts. A debtor’s disposable income is calculated by deducting the allowed expenses amount determined by the IRS from the current monthly income, in case the debtor’s income is higher than the state’s median income.

Compulsory credit counseling session before declaring bankruptcy:

According to the new law, the debtors are required to undergo a counseling session before filing a petition for bankruptcy. The government has encouraged the credit counseling agency to impart financial education to the debtors. The counseling session will help the debtors to make right choice whether bankruptcy will be suitable for their financial situation.

Effect of the changed law on child support and Alimony:

The new changes in the law ensures that the family of the people filing under chapter 13 bankruptcy, will get the prime importance before the creditors while designing a payment plan. Therefore, child maintenance and alimony will be the primary focus before anyone else.

Therefore, the changes made to bankruptcy laws will force people to try out other debt relief options before filing bankruptcy.

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3. Smart steps to pay off Christmas debt

As per researches made by the National Retail Federation, the average American will spend an amount that is close to $700 in gifts, decorations and cards according to their choice. If you’re someone who is in debt, just say a big NO to gift-buying, this Christmas holiday. There’s no need to overstretch your budget and fall in a mess in the long run. Will you be surprised to know that there are ways in which you can be your own Santa and also stay within your budget while celebrating Christmas in the most memorable way possible?

1. Plan your things: Without a proper planning, you can never keep a track on where your pennies are going. As Christmas is a festival that is close to your heart, it is very obvious that you’ll feel like spending a lot but you have to remain within your budget keeping in mind your present financial state. It just takes 10 minutes to create a spending plan and thus don’t take the risk of not planning your budget during Christmas.
2. Utilize the social media: Before you start shopping for your Christmas gifts, did you check your Facebook and Twitter account? With the widespread use of the social networking websites, the retailers often offer discounts exclusively for their Twitter followers or Facebook friends. If you employ a quick search of the recent wall posts in Facebook, you may discover some money-saving codes that can be beneficial to you.
3. Use the discount gift cards: Wouldn’t it be great if you could get a gift worth $100 for $80? It is possible to purchase discount gift cards from thousands of offline and online retailers like the Home Depot, Apple Store, Radio Shack and many more. By availing such discount cards, you may get rebates up to 5%-30% off the face value of the card.
4. Bring on the envelope method, chuck off credit cards: Using your credit cards while making the Christmas purchases is a bad habit that needs to be changed if you want to be your own Santa this Christmas. Put back your credit cards and debit cards and instead allocate a lump sum amount of cash for every gift so that you don’t incur further debt.
5. Find online discount codes: Never purchase something online unless you find out the discount code. There are people who have saved hundreds of dollars and it doesn’t take even a minute to search for such discount codes online. During a checkout process, use the discount code so that you can get free shipping or even be able to save at least 20% on goods.

Sacrifice buying gifts for your own when you have lots of things to gift other people. This much you can certainly do to stay on top of your finances and also remain socially aware during Christmas. Follow the tips mentioned above to put more “green” and less red into your holiday shopping in 2011. Taking a diligent step now will help you avoid spending time knocking at the doors of professional debt consolidation companies.

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Cohen & Slamowitz, at Woodbury, N.Y, is a decade old collection law firm that has been reported to file 80,000 lawsuits over the last year with only 14 lawyers on staff, each dealing 5,700 cases. This may look incredible but it is being possible only for using software called Collection Master manufactured by a company named Commercial Legal Software. Richard Rubin, a lawyer from New Mexico termed the procedure as ‘factory approach to practicing law’.

Usually a collection agency sends extensive database of the debt stricken consumers to the law firm. Then the firm employs the software to automatically run over the data and operates the entire legal system. The system replaces all the paper flow of traditional collection process and covers everything from sending out collection letters, summons to lawsuits via email. The information that a collection agency sends to the law firm is stored in an electronic data base. It contains the name of the consumer, his address, his outstanding balance on credit card and interest rate if any, accruing on his account.

Another type of debt collection software that law firms use is web based software that does not require installing any additional hardware or software system. Casetrackerlaw is one such web based solution that hosts online application and performs all the functions in a customized way. It helps a law firm manage debtor’s payment, collection fees, client fees and filing fees.

However, due to handling huge data, errors or questionable information are also getting processed into the system. So the Fair Trading Commission is now urging the state authority to make collection rules much more stringent. If any debtor challenges the amount of his debt, the collection agency must show substantial proof against him to validate their claim. This is now a growing debate how the debt collection law should function and to what extent.

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3. Tackle That Debt Problem

Financial crisis due to debt affects millions of US citizens. Consumer debt problems are a major problem because not only do they cause stress for the persons involved, they also cause stress for the families involved. Because so many Americans take pride in their ability to earn a living and to keep a financial household, they associate their financial situation with success or failure. This causes a problem in that the person who has financial problems rarely wants to admit that they are in trouble. The only way to solve such financial stress is to first admit that you have a problem and secondly find someone to help with debt problems. Because all people at one time or another endure financial problems primarily due to debt, it’s important to open up to other people around you because they may have ways in which they can help with debt problems.

If your finally able to admit that you have a financial debt problem, there are several avenues that he can go to get help. Some of the very common methods are using credit consolidation company or a debt settlement company. The credit consolidation company contacts your creditors to negotiate your debt such that you get a lower rates and you pay one bill for all your debts. In this example, you would make a one single payment to the credit consolidation company and they would make payments to your creditors on your behalf. The other method is using a debt settlement company. Going to the process of debt settlement can be very advantageous because the company actually negotiates your total amount of debt to a lower amount. In other words you’re going to pay less than what you originally owed in the first place.

The other option that people never think of is using debt management counselors through a nonprofit organization. These counselors are there to help you create a plan to manage your debt and eliminate your debt. They also offer financial educational classes to teach you how to avoid consumer debt in the future. These programs are available in almost all communities and are funded through private organizations and the government.

As outlined in this article, if you can admit that you have a consumer debt problem, then you open yourself up to all kinds of different ways to solve your debt problem. These include finding a debt counselor, signing up for a debt consolidation program, or finding a debt settlement company to assist in eliminating your debt. All of these methods are a practical way to solve your debt problem.

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2. What is the difference between debt consolidation and settlement?
3. Smart steps to pay off Christmas debt