| Payoff Debts Without Loans |
| By Credit Federal |
Published
01/23/2008
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Debt Help
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No Credit or Loan Debt Payoff
Are you one of many poor or no credit consumers who cannot obtain a credit card nor a secured or unsecured loan to pay off debt? A common sense approach may be the right choice for you.
As creditors and lenders tighten purse strings and harden loan approval qualifications, many consumers; including home owners, are finding it difficult to get more credit. But more credit is not always the answer, and there are solutions other than credit counseling or to negotiate settlement. Here are some things you can do to free up money you already have:
Improve Personal Finances to Payoff Bills Without Adding More Debts
Setup a household budget to see where your money is going. Examine your bills to see where you can cut expenses.
Adjust deductibles for your home and auto. Larger deductibles could equal huge savings on your monthly payments.
Modify useage plans and options for your cell phone to cover just the bare necessities.
Give yourself a tip. Instead of eating out and paying more to do so plus paying a tip, brown-bag your lunches.
Lower interest costs. Pay more than the required minimum monthly payment.
Wish you had $5,000.00 today? You would if you had a savings account that you had been feeding, so start one today.
Your debt problems are not your own. Two of the biggest banks, Citigroup and JPMorgan Chase, recently announced they are setting aside nearly $6 billion between them to cover potential defaults on consumer loans. Because balance sheets are devastated after the huge mortgage write-downs of the last two quarters, that's why banks are tightening their lending standards. Unfortunately, this will make it difficult to revive consumer spending. Banks are likely to keep raising rates on credit cards and other consumer loans regardless of federal interest rate cuts.
Citigroup Chief Financial Officer Gary Crittenden said the bank is looking at raising rates on its credit cards to protect itself from a potential surge in late payments. How much more damage will banks, and Citigroup in particular, have to contend with from the consumer slowdown? They may have to boost reserves again to cover problem loans. And each time a bank is forced to sock away money, it eats into earnings. Already analysts estimate that the billions Citigroup set aside for future consumer loan losses cut its fourth-quarter earnings by 50 cents a share.
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