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    How to Manage Your Debt
    How to Manage Your Debt

    Disclaimer: Penny Calling Penny is an affiliate website. This means that we get a small commission when you click some of the links in this article. Don’t worry – we’ll never recommend anything we wouldn’t use ourselves.

    Debt is an unfortunate part of life that everyone must deal with. That’s why you’re reading this article right now, to help yourself better manage it so you can live a debt-free life.

    There are two types of debt you really need to understand. Secured and Unsecured. Under each of these come different kinds of debt that need different management. To help yourself out of debt, you need to know what exactly what you’re getting into and use good payoff strategies. Along with the usual method of advanced payments, there are other ways to help you manage your debt. Let’s take a look.

    1. Secured Debt

    This debt is all about securing assets for the lender. The lender will place a claim on whatever you’re buying to guarantee you will pay it whenever you take out a loan. This method may sound like blackmail, but it actually does help the lender and you by letting you use the asset at a lower interest rate until you can pay it off. These loans tend to be big, so paying them off completely will take time unless you’re loaded.

    And, of course, we’re assuming you’re not if you’re reading an article about helping you manage debt. Regardless, here are some examples of secured debt and how they work.

    2. Mortgages

    If you have a mortgage already, then congratulations! Not only are you on your way to owning your own house, but mortgages also have the least interest rate than any other loan. But debt is still debt.

    Unfortunately, this type of debt is often the highest, with real estate being one of the priciest goods to purchase. After all, you need a roof over your head and the means to take care of yourself, but most people don’t want to be living out of a shed.

    While it may take much longer to pay off a mortgage than any other loan, that doesn’t mean there aren’t ways to make that happen. On top of making advanced payments, you may want to try refinancing your mortgage for a better deal. You can save hundreds just by finding a mortgage with a better interest rate.

    3. Boat/RV/Auto Loan

    These loans are very much alike. They have fixed interest rates and can have up to a 20-year loan term. Most of these loans vary by lender, so make sure you research what your lender provides. Some loans can even be unsecured, so you may have to include that in your payment strategy.

    One of the things to look out for when buying from a lender is, do they pay a fee for early payoff? The whole point of managing debt is to get out of debt quickly, so you need to make sure you understand all the hidden fees. Make sure you use an auto loan calculator to find out how much you’ll be able to save before plunging right in.

    4. Unsecured Debt

    This type of debt allows the buyer to use as much of your predetermined limit without collateral. Failure to pay off any accumulated debt can result in a big court battle. This comes at a high cost for the lender, so interest rates tend to be higher. They also tend to be smaller than secured loans reaching between $1,000-$50,000, and require fixed monthly payments over a certain number of years to pay off on time.

    5. Credit

    Your credit is under your control within the proper limits. Credit cards are a form of revolving credit that allows you to spend as much money under the agreed limit of the lender. It’s up to you to spend responsibly, so you don’t get overwhelmed with debt. The best way to get out of credit card debt is to figure out where you’re having problems paying.

    By checking your credit with Credit Sesame, you can easily track your credit information to make better choices. Are you late on a payment or have a bad credit history? You may be able to see where you’re lacking and raise your score by 300 points. A good credit score is essential to gaining loans for other ventures such as personal, mortgages, and auto loans. So, you need to make sure your credit is between 600-850.

    6. Personal Loan

    A personal loan is just that. A loan that you want for personal reasons. This can pay off new utilities, expensive vacations, or just about anything else as long as you get permission from the bank. There’s nothing too complicated here except to make sure you have the means to gain one of these loans.

    It is very possible to use a personal loan to pay for boats, RV’s, and cars. If you Use Fiona, you will be able to find low-interest loans to help you find the best deal to pay off whatever it is that you need to pay off.

    Join thousands of others who have already saved by refinancing.

    7. Student Loans

    These loans are borrowed from the government or a lender to pay for schooling. These are different from grants or scholarships since you actually have to pay back all that money. Student loans need you to sign a promissory note that includes all the terms and conditions of the loan. By signing the document, you agree to follow these terms and repay the loan, including all that interest.

    There are two different types of student loans, Federal and Private. There are also other types of federal loans, but most of them require payment until you are out of college. This helps students to focus on their schooling instead of paying off debt. Yet. On the other hand, private loans are usually more expensive, have a higher interest rate, and require you to make monthly payments during schooling.

    Students fear not! Paying off student loans quickly is easier than you’d think with consolidation and good money-saving strategies. Debt consolidation is a good idea to investigate. All your loans merge into one to give you a fixed rate and help organize all your payments. If you have a good credit score, you may even be able to refinance your loans through Credible to get better deals with refinancing companies.

    Read more on Student Loans

    Debt and finances are hard to manage but knowing is half the battle. This is an excellent reason to seek extra help from companies like Anasova to help manage your finances without the use of costly advisors. Debt won’t be as much of a problem anymore.

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    "“When getting help with money, whether it is insurance, real estate or investments you should always look for a person with the heart of a teacher, not the heart of a salesman.”"

    Dave Ramsey

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