If you're having trouble making regular payments on your bills in Mississippi, it's important for you to take a hard look at your finances and find a way to get rid of your debt problems. One way out is Mississippi debt consolidation. It helps you combine multiple bills into one low monthly payment that's convenient for you to manage.
Mississippi debt consolidation - Options you can consider
There are 2 ways you can consolidate and merge multiple bills into one monthly repayment. These are:
1. Consolidation program: You approach a Mississippi debt consolidation company that negotiates with your creditors to lower the interest rates on your bills and helps you replace multiple bills with one low monthly repayment. Check the details on how a consolidation program works.
Here's an example:
Let's say, you have 2 credit cards and 1 medical bill. The details are:
Credit card X with a rate = 15%, outstanding balance = $40000
Credit card Y with a rate = 14%, outstanding balance = $25000
1 Medical bill with an interest rate = 10%, outstanding balance = $25000
The average rate of interest on these bills = (15 + 14 + 10)/3 = 13%
When you're in a Mississippi debt consolidation program, the company may be able to lower your interest rates to 12%, 10%, and 8%.
The average rate of interest = (12 + 10 + 8)/3 = 30/3 = 10%
So, if your total balance is $90,000, you'll save = 3% of $90,000 = $2,700 on a monthly basis.
2. Consolidation loan: You take out a Mississippi debt consolidation loan from a bank or private lender. This loan is available at a low interest rate. Hence, with one big loan, you'll pay off all your bills and you'll have only one loan to repay on a monthly basis. Before you apply for the loan, it is essential that you find out how much you'll save by paying your bills through consolidation. Use the debt consolidation calculator for this purpose.
Mississippi debt settlement - How it works
When you can't pay your bills with a consolidation program, you should try to settle them for an amount less than what you owe. This can be done by negotiating with your creditors to lower your debt amount. If you are unable to settle your bills yourself, it is essential that you enroll in a Mississippi debt settlement program where the company/law firm you're working with will co-ordinate with creditors and have your outstanding balance reduced. The benefits are:
- Eliminate outstanding balance
- Erase late fees and over-limit charges
- Get rid of collection calls
Here's an example:
Let's say, you have 2 credit cards:
Credit card X = $35,000
Credit card Y = $25,000
In addition, you have a personal loan with an outstanding balance of $15,000.
The total outstanding balance you owe = $75,000
If your creditors are willing to settle the debt for 55% of what you owe, then the amount you need to pay = $41,250
So you save in total = $75,000 - $41,250 = $33,750
Thus, with a Mississippi debt settlement program, you can save money and get rid of bills within 3-5 years. However, if you're confident that you can tackle your bills on your own, you should try consolidating or settling bills on your own.
How to tackle debts on your own in Mississippi
When it comes to dealing with debt on your own, you can negotiate with creditors and ask them to lower the interest rates on some of your accounts. If you've racked up a lot of debt on credit cards, you should try one of the debt reduction strategies below:
- Snowball method: This is where you pay off the lowest outstanding balance first with extra payments while paying the minimum balance on other accounts. Once the lowest balance is paid off, you pay extra towards the next highest balance, and so on.
- Avalanche method: With this option, you pay extra towards the highest interest credit account while making minimum payments on other accounts. Once the account with the highest interest rate is paid off, you can then make extra payments towards the next high interest account, and so on.
For further information, refer to this article on debt reduction strategies.
If you have debts other than credit card accounts, you can ask the creditors to reduce the interest rates on your bills so that your monthly payments can be lowered. If you can't afford to make monthly payments over a long period of time, it is better that you try to settle the bills with your creditors. Check these steps on how to settle your bills yourself.
FAQ on Mississippi debt consolidation and settlement
Q) I have 3 internet payday loans in Mississippi. I can't afford to make payments anymore. What should I do?
Ans: You can enroll in a payday loan consolidation program and have your monthly payments lowered. Or, you can apply for a Mississippi debt consolidation loan and use it to pay your bills with one large payment.
Q) We have accumulated debt on 3 credit cards, 2 personal loans, and a medical bill. My spouse has been laid off from his job and I'm finding it difficult to manage all of these bills. Is there a way I can get out of this mess?
Ans: Since your spouse does not currently have a job, and you can't make payments on all the bills, you should negotiate a settlement with your creditors and try to reduce your outstanding balance. If you are finding it difficult to negotiate on your own, get help from a Mississippi debt settlement company to negotiate a settlement with your creditors.