This process is mostly about discipline and commitment to a goal. If you have decided that you have had enough of avoiding debt collectors and not answering your telephone calls, there are strategies that you can follow in order to either eliminate debts or at least get them under control.
Use a Budget
Make sure that you put together a budget and have money put aside towards all anticipated bills including annual expenses such as insurance, car registration, rates etc. Being prepared is half the battle.
Financial Counselling
You can contact any number of professional debt negotiators or debt counsellors. Perhaps you will even find a free financial counselling who could assist with preparation of a budget as well as setting out for you the available debt relief options to consider.
Alert creditors ASAP
If you are unable to meet existing financial commitments the best thing to do is contact the creditor (the business or person you owe money to) as soon as possible to explain your circumstances and determine what can be done to help. Sometimes they will agree to a reduced payment during your period of hardship or no payments for a few months while you catch up.
Payment Plans
When negotiating a repayment plan with your creditors, make sure that you only commit to a realistic plan one that you are able to afford. Honesty is very important here. You need to take into account your other commitments and do not promise anything that you are unable to deliver as this will affect the relationship with your creditors and their trust in your word.
Make sure that you record any letters you have received from your creditors or letter you have sent to them and their responses. Keep copies of any letters you send or receive (and notes of any conversations you have). As your agreement is informal these will assist to reinstate all arrangements if your creditor changes their mind
Ensure that the debt is actually yours
Make sure that the debt you are paying or being claimed is actually yours. If you do not remember committing to a debt or a loan or a service that you are asked to pay for – ask the creditor for evidence that you actually owe this money.
Check integrity of your credit report
All too often people find items on their credit report that they either know they have paid or was never their debt. Make sure that before you seek to agree a payment plan that you have not already paid the debt or that the debt is actually yours. It is possible to dispute a debt or simply ask the credit provider to cancel the debt if the invoice was raised in error.
Obtain independent advice if you are still not sure whether you have to pay some or all of a debt.