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What is a Debt Problem?

Being unaware or unsure of the total amount of debt you owe.

When your debt payments (other than your mortgage) are more than 20% of your gross (before-tax) income.

When you have paid late fees and/or over-the-limit charges at least twice in the past year.

When you have received phone calls from creditors about overdue bills more than once during the past six months.

When money problems cause distress or conflict at home and/or work.

If you are near your credit-card limit(s).

Living Paycheck to Paycheck

Borrowing from “Peter” to pay “Paul.”

Transferring Credit Card Balances to save on monthly interest.

Not being able to pay the minimum payment on your credit cards each month.

Not Having any savings.

What Is Debt?

Monthly payments can be broken into two categories:  Debt and Expenses.

  • A debt is a specific amount of money owed for goods and services paid over time.  For example, debts include your home mortgage, a home improvement loan, a car loan, an educational loan and credit card balances carried over from month to month.  These are all amounts that eventually CAN be paid completely off. However, Do NOT include bills you pay off each month, such as credit cards charges you pay off in full when the bill comes to your home.  A word about Leases: If you want the amount of your lease payment to be automatically rolled into your accelerator once the lease is ended, enter the lease as a debt with a zero interest rate.
  • Expense are payments without a “fixed purchase” amount, such as food, taxes, utility bills or insurance premiums. These are on-going payments that can’t usually be eliminated. You can never totally pay them off.  These items SHOULD NOT be included in your amounts to be Negotiated.

If you do not have savings, you should be concerned because you may not be able to adjust to an unexpected situation that requires additional financial resources. If you are exhausting savings to keep up with your bills, it may be an indication that you are spending more than your income can support.

Do you pay only minimum payments on your credit cards?

If you are only making minimum payments and can afford to pay more, you should. If you can only afford minimum payments or not much more than minimum payments, you are probably overextended and should analyze your budget and adjust your spending behavior. It is likely that if you are thrown into a situation that requires more financial resources, your situation will become unmanageable.

Have you been declined credit or declined a credit line increase?

Being declined for credit is a good sign that you need to evaluate your finances. Creditors use guidelines to determine your credit worthiness and if they decline you, it means that they feel that your finances exhibit signs of trouble.

After you pay your monthly credit card bills, do you accumulate as much or more debt the following month?

This may be a sign that you are dependent on your credit cards to maintain your style of living or supplement day to day living expenses.

Can you account for the total amount of debt that you owe? Do you avoid adding up the total of the amount of your outstanding debt?

If you can not account for the total amount of debt that you owe, you may be avoiding the problem. You must confront your spending behavior. Stop avoiding the pain of paying on your debt and establish a better repayment plan before the situation becomes unmanageable.

Are your cards nearing or over your available credit limit? Have you ever attempted to make a credit card purchase and had the card declined?

If the answer is yes, it may be another sign that you are turning your cheek to the pain of confronting paying for credit card purchases. It is also a sign that you are not aware of your financial situation. If you were aware of your finances and understood how high your balances were, the situation could have been avoided. Your creditors assign a credit limit to you based on your credit history, outstanding indebtedness, and income. If you are at or near your limit it is a good sign that you are headed for financial trouble.

Are you dependent on cash advances to pay on your other credit obligations?

Danger!!! Stop immediately!! Your income can not support your style of life. Analyze your budget and make adjustments. You may need to seek outside help for guidance.

Do you purposely hide credit card bills from family members?

Hiding debt from family members is an indication that you realize that there is a problem. The fact that you feel you have to hide your spending behavior from loved ones indicates that you refuse to confront the situation, but realize there is a problem.

Do you float checks or bounce checks?

Floating checks is the practice of issuing a check in hopes that by the time the check is cashed, you will have the money in the account. Floating and/or bouncing checks is an indication that you are living paycheck to paycheck and your finances are in trouble. Floating and bouncing checks indicates that you are not fully aware of your financial situation.

Do you get collection calls from creditors?

Collection calls are a sure sign that you are behind on credit obligations. Don't avoid the problem. Start planning to become current again.

If you answered "yes" to any of these questions, click here for "no fee" debt assistance.

Landmark Consumer Credit Services
4699 North Federal Highway, Suite 107
Pompano, FL 33064

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