Debt management is not a one-size-fits-all solution but rather an amalgamation of choices you can make to best pay off your outstanding debts. If you have a large amount of debt, whether it's "good debt" like a mortgage or student loans, or other debts like credit card debt, it can impact your credit scores depending on how well you manage the debt. Whatever your reason for wanting to reduce what you owe, like enhancing your credit history before applying for a mortgage or loan, success starts with building a strategy that will move you forward. Creating debt management plans, debt reduction strategies, or seeking the help of a credit counselor are all viable ways to help with your debt management. However, seeking the best solution depends on your unique situation, along with the type and amount of debt you owe. Other debt reduction strategies include short-term and long-term strategies to help better manage the amount of debt you owe, so you can plan ahead while still taking your lifestyle into account. Meanwhile, credit counseling is when a person or team sets you up with a budget and teaches you money management skills while creating a plan for helping eliminate your debts. However, one should look out for credit counseling scams, which could put you deeper in debt.
When considering debt consolidation, it's good to know how this repayment strategy might impact your credit. At Equifax, we cover why debt consolidation may be a good idea, including the pros and cons.
Collection agencies are used by creditors and lenders to collect funds that are past due or in default. Learn more about your rights and what collection agencies can and cannot do.
Your credit utilization ratio is a factor in calculating your credit scores. Learn more about credit utilization and how it can impact your credit.
What can you do to make sure that you stay in good standing with your lenders and creditors?
"Credit repair" companies may sound tempting. But the truth is, there is no such thing as a "quick fix" when it comes to your credit. Learn how to recognize legitimate credit counseling organizations vs. scams.
Bankruptcy isn't the only solution for those struggling with major debt. Credit counseling may be a helpful option.
Try these two strategies if you’re juggling multiple debts and unsure how to get started on repayment.
Don’t dread paying bills each month and make sure you’re not paying more than you should.
If you’re having trouble keeping up with your bills during the Covid-19 pandemic, your lenders may be more willing to work with you than you think.
If you need treatment for Covid-19 or another ailment, be sure to know your options.
If you have a debt in collections, negotiating with a debt collector may help you pay less and resolve the issue faster.
How will you be affected when debt collectors start calling - and what can you do to better protect yourself? It's important to know your rights.