Unemployed: Some Debt Strategies

Hi,
When we find ourselves unemployed, it is important not to neglect our financial responsibilities. We need to make a list of our outstanding monthly expenses starting with our basic survival needs. We need to make another list of all available funds that we have to meet expenses. Here are some suggestions:
1) We need to call the mortgage company if we are having doubts as to whether or not we can make the next mortgage payment to explain the situation in detail and see what options the mortgage company offers. Some of the options available are extending the payment until the end of the mortgage, making partial payments, or making interest only payments. Keep in mind that the mortgage company wants to work out the problem and does not want to have to foreclose on the house.
2) If we rent, we need to call the property management company as soon as possible to explain the situation and work out a livable solution. For instance, if we know unemployment is going to come in two weeks down the road, we can ask the rental company if we can make our payment then.
3) We need to call all the utility companies and work out suitable financial arrangements. Inquire about whether or not there are any programs in place for short term help.
4) We need to examine our monthly expenses in the food and entertainment areas and cut back as quickly as possible.
5) We need to call our remaining creditors and request deferrals on our monthly payments. If we are able, we should send them a good faith payment. We need to assure them that we will contact them periodically to let them know the status of our employment and our ability to resume making full payments.
As always, one of the most important things we need to do regarding our debt is communicate with our creditors. It is in our best interest and their best interest to work out all situations.
Next week I will start talking about credit/collections and small business.
Until then,
Alan

Divorce and Debt

Hi,
In almost every divorce, the debt of the married couple turns into a problem. When the divorce is bitter, debt is totally ignored as each party believes that the other should be responsible for it. This is the equivalent of joint financial suicide. Even if the divorce is uncontested and emotions are in check, how efficiently the marital debt is handled during the divorce process can save both parties financial headaches in the future. The first step we need to take in order to efficiently manage debt during a divorce is to gather financial information in the marital estate and identify debts for which we are responsible. It is important to remember that even if we feel reasonably certain that the court will order some of these debts to be paid by our spouse, that we still need to deal with them until that time. This will assure our credit rating to remain intact once the divorce is final. If emotions are running amok in a particular divorce, it may be a good idea to solicit the help of a trusted friend or third party to gather as much information as possible on one's behalf. In situations in which all financial information isn't readily available, banks and mortgage companies will disclose pertinent needed information over the phone such as balances, monthly payment due dates etc., Another way to identify creditors of the marital estate is by running a credit report on both individuals. Tomorrow I will talk about some short term steps to take once the information has been gathered.
Until then,
Alan

A List of Various Ways We Incur Debt

Hi,
We're going to investigate various types of debt in detail:
1) Personal loans both unsecured and secured
2) Credit card debt: business, personal and Internet
3) Leases
4) Mortgages
5) Conditional sales contracts
6) Finance company debt
7) Credit lines
8) Charge accounts
This is not an exhaustive list of types of debt, but one which covers the instruments by which most people incur debt. We will discuss the risks and rewards of each of these loan structures in following blogs.
Tomorrow the topic is unsecured personal loans.
Until then,
Alan

Scared to talk about debt?

Did you know that most people are afraid to talk about debt? Both single people and married couples find themselves avoiding their debts in a variety of ways including not opening their mail, losing their bills, and accidentally throwing away their credit card statements. Avoiding debt causes multiple new problems for people who owe money. Over the next couple of weeks, I'm going to blog about how to take that first step in identifying your debt problems, and what you can do about them. Tomorrow I'm going to tell you how you can begin to analyze your own debt.

Until then,
Alan