Learn how to eliminate debt effectively to save money and avoid credit damage
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Debt.com can help you learn how to eliminate debt more effectively.

Eliminating debt is an essential skill for maintaining financial stability. If you have debt, you need to be familiar with debt elimination techniques – both traditional methods and alternative relief options. Luckily, you have Debt.com to help you along. We’re experts in the best ways to eliminate debt so you can save money, build credit, and avoid collections.

The articles here are all dedicated to helping you keep up with the latest tips and techniques for eliminating debt. Whether you need to pay off student loans or reduce tax or credit card debt, we have you covered. You can find more elimination tips below.

Researching vacation time

If You’re Trying to Lower Your Debt, Get Out of Hawaii

December 6, 2017 | Dori Zinn

Hawaii has 539 times more debt than Washington DC.

Calculating a debt settlement plan

Is Debt Management Or Debt Settlement Better For Me?

December 6, 2017 | Howard Dvorkin, CPA

A reader is deep in debt, but one plan is better than the others.

Don’t Give Up: You Can Bust Out of Self-Imposed Debt Prison

November 7, 2017 | Deb Hipp

Debt doesn’t have to be a life sentence. Here’s how to tunnel your way out.

Can a Debt Management Program Hurt My Chances To Buy A House?

Will A Debt Management Program Hurt My Chances To Buy A House?

November 1, 2017 | Howard Dvorkin, CPA

A reader is finishing a DMP but wants to buy a home. Good news awaits him.

Capitalism a Way Out Of Debt

In Defense Of Capitalism As A Way To Get Out Of Debt

October 23, 2017 | Howard Dvorkin, CPA

As social issues roil the country, some have attacked our basic economics. They’re wrong.

Andy from Marriage, Kids and Money

The Day Andy Decided He Was Done With Debt

September 27, 2017 | Brian Bienkowski

He and his wife realized they weren’t rich, they were broke.

Paying off my debt means eating ramen all the time

How Can I Pay Off My Credit Cards Without Eating Ramen Noodles Forever?

September 20, 2017 | Howard Dvorkin, CPA

A reader wants to pay off his credit card debt, but he also wants to eat.

A woman drawing with markers shows how to work side hustles

A Portrait Of America’s Side Hustlers

September 15, 2017 | Michelle Bryan

Surprisingly, income level doesn’t determine who has a side gig

A teenage driver behind the wheel could hurt your car insurance

Car Insurance for Your Teen Will Drive You Crazy

September 11, 2017 | Howard Dvorkin, CPA

They’ll also (literally) drive you into the poor house.

Magic Hat Trick

What Tricks Can I Use To Raise My Credit Score?

September 6, 2017 | Howard Dvorkin, CPA

A reader wants to buy a house, but his credit score is “in the toilet.”

Is student debt hanging over your head

Cheaper Cost of Living Means Southerners Pay off Student Loan Debt Sooner

September 4, 2017 | Dori Zinn

More Americans living in Southern states can put more money toward their student loan debt since cost of living is cheaper.

Mortgage loan officer calculates costs on a residential home loan during the underwriting and approval process

Is Mortgage Really Considered “Good Debt”?

August 30, 2017 | Howard Dvorkin, CPA

A reader wants to know when too much of a good thing is bad.

Howard Dvorkin’s next recession prediction starts with an auto loan bubble, but it originates from used car lots.

One More Reason Why I Still Fear An Auto-matic Recession

August 21, 2017 | Howard Dvorkin, CPA

It has to do with cars, but not really auto loans.

Lauren from Financial Best Life talks about shopping addiction

Lauren Went on a “Spending Freeze” to Pay Off $8,000

August 16, 2017 | Brian Bienkowski

The debt she accrued wasn’t her fault this time, but it was her responsibility.

Dollar sign with life saver in ocean

Americans Are Finally Saving For Emergencies

August 9, 2017 | Joe Pye

The number of Americans without an emergency fund is at a six-year low.

Betsy DeVos looks at a classroom of lawyers (illustrated)

18 States Say Betsy DeVos Is a Failure

August 3, 2017 | Brandon Ballenger

The education secretary is being sued for siding with for-profit schools over students. But at least she’s learning from her mistakes.

Portrait of Zina from Debt Free After Three, Debt.com’s Financial Profiling featured personal finance blogger

Zina Paid Off $28,000 of Debt in Three Years

August 2, 2017 | Brian Bienkowski

She put every extra penny toward her student loans and carefully tracked her spending.

Debt buyers are quietly trading America's past-due debt

Americans Are Buried in Debt, But What About the Rest of the World?

July 31, 2017 | Howard Dvorkin, CPA

Sadly, we’re No. 1 in one of the categories we don’t want to be.

CREDIT SCORE NOT A LOAN

Here Are All The Ways Your Credit Score Is About To Jump

July 17, 2017 | Dori Zinn

Crippling debt can totally kill our credit history, which makes buying a home or car or even getting a credit card nearly impossible. But some new changes to reporting are going to seriously boost your credit score.

Perspectives on how the student loan debt in America stacks up

Money on the Street Interviews: What’s Your Opinion of Student Loan Debt in America?

July 13, 2017 | Michelle Bryan

Half-clothed beachgoers give some very serious answers about their thoughts on federal student loans and the debt they cause.

Debt.com debt news illustration by Ivan Benavides: Female student walks towards hole as businessman considers housing market

Debt News You Probably Haven’t Heard — But Should

June 26, 2017 | Howard Dvorkin, CPA

This week: clueless about student loans, passionless about work, passionate about boycotts.

A married business woman places her hand on her face in frustration, uncertain about her debt, budget and finances

Americans Wish They Saved More

June 21, 2017 | Gregory Cox

Not saving enough for retirement is a bigger regret than taking on too much debt

Lindsay from Notorious Debt

This “Money-Pit” Ruined Lindsay’s Finances

June 21, 2017 | Brian Bienkowski

It left the Notorious D.E.B.T. writer and her husband hopelessly in debt — but they’re making a comeback.

Stained glass window of Moses carrying the 10 Commandments. Which Commandment can predict your debt?

How One Of the 10 Commandments Can Predict Your Debt

June 19, 2017 | Howard Dvorkin, CPA

If you break this Commandment, you’re probably broke.

An indebted woman ponders the question: can debt collectors come to your house?

Is It Legal For Debt Collectors To Ring My Doorbell?

June 7, 2017 | Howard Dvorkin, CPA

This week: A reader asks about debt collectors, repo men, and “Fonzi” schemes.

prioritize debts

Are You Paying the Wrong Debt First?

June 6, 2017 | Dori Zinn

We’re paying off unsecured personal loans faster than auto loans, mortgages, and credit cards and we probably shouldn’t be.

Graduates stare at a tsunami of student loan debt (illustrated)

Student Loans: Too Big to Fail? Or Too Much to Succeed?

June 1, 2017 | Brandon Ballenger

The “student loan crisis” is so massive, we can’t even comprehend it anymore.

debtfreegeek

Chris From Debt Free Geek Believes in Intensity

May 31, 2017 | Brian Bienkowski

It not only helps him stay debt-free, it also protects him.

Close-up of a gold-ingot on top of a troy ounce silver and palladium bar

How Do We Prepare For The Next Recession?

May 31, 2017 | Howard Dvorkin, CPA

A reader agrees with her husband: A recession is coming. They don’t agree on what to do about it.

Betsy DeVos rides a bear at the circus with ringleader Trump (illustrated)

Donald Trump’s Student Loan Circus

May 25, 2017 | Brandon Ballenger

He wants to ditch almost everything that helps students save money and manage debt in order to “prioritize students” and “empower parents.”

A team of 2 firefighter of a German fire brigade after an exhausting training session with protective gear

Can Volunteer Firefighters Get Student Loan Forgiveness?

May 24, 2017 | Howard Dvorkin, CPA

A reader wants to know if you need a real job to get real debt relief.

Ed Sheeran

You Should Manage Your Money Like Ed Sheeran

May 22, 2017 | Emily Bloch

Turns out, the millionaire knows a thing or two about saving.

how to avoid financial stress

High Debt Gives Us High Anxiety

May 19, 2017 | Joe Pye

Most Americans don’t have a plan to deal with an average debt of $37,000.

David, writer from Run The Money, explores similarities between physical and financial health

Financial Pain is Nothing to David from Run the Money

May 17, 2017 | Brian Bienkowski

Sure, it hurts, but he’s been through worse.

wedding debt

How to Get Married Without Going Broke

May 4, 2017 | Make Change

Weddings are expensive, but these three thrifty brides had the day of their dreams while continuing to save for happily ever after.

debt management plan

Ask the Expert: Are Debt Management Plans Legit?

April 12, 2017 | Howard Dvorkin, CPA

A reader wonders if the letters DMP are A-OK.

student loans

Student Loans Make Millennials Desperate

April 11, 2017 | Joe Pye

Nearly 90 percent of young employees would commit to an employer for 5 years – if it helped them pay back their debt.

Portrait for Chonce Rhea, creator of the blog My Debt Epiphany

How Chonce Overcame Dire Financial Troubles

April 5, 2017 | Brian Bienkowski

She once relied on welfare. Now she’s a successful personal finance coach.

singers and songs about debt

10 Songs About Debt That Aren’t by The Beatles, ABBA or Pink Floyd

April 3, 2017 | Emily Bloch

Because let’s face it — those aren’t relevant anymore

40-hour work week? Try 60

How Working Too Hard Can Drive You Into Debt

April 3, 2017 | Howard Dvorkin, CPA

You’ve heard the term, “work smarter, not harder”? Try “work less, save more.”

The stock market continues to rise and break records, but are Trump and the stock market a match made in Heaven?

Ask the Expert: Jump On The Trump Train?

March 29, 2017 | Howard Dvorkin, CPA

This week: A reader wants to dive into the stock market and clean up. But is he making a mess?

2017 taxes

Settling the Splurges

March 28, 2017 | Dori Zinn

As more Americans plan to save their tax refunds, fewer plan shopping sprees.

Do you pay use tax?

Tax Refunds Are Helping Us Save

March 13, 2017 | Dori Zinn

Most Americans will save their money or pay off debt with their returns.

High interest savings accounts

Even Military Families Are Cutting Back Spending

February 28, 2017 | Dori Zinn

The vast majority of middle-class military families — like commissioned officers and senior non-commissioned officers — are planning to improve their finances this year, even though they make at least $50,000.

medical expenses debt

Tax Refunds Aren’t Getting Us Out of Debt

February 23, 2017 | Dori Zinn

Forty percent of American families are making thousands of dollars in medical, auto, or tax payments at some point in a year but even after paying, they’re suffering from crippling debt.

millennials in debt

Millennials Give Scary Answers to Silly Questions About Debt

February 20, 2017 | Howard Dvorkin, CPA

The generation that will soon take over the world has yet to conquer its own financial woes.

get out of debt fast piggy drowning

8 Foolproof Steps to Get You Out of Debt Fast

February 10, 2017 | Money Talks News

Want to speed up your debt-reduction efforts? Here’s how to do so without a crash diet.

If you're like two thirds of adults, you have a fear of debt; the solution is to wipe it out

Most of Us Fear Debt

January 25, 2017 | Dori Zinn

Two-thirds of young adults have an actual fear of debt, even though they plan their spending on a constant basis.

If the paperwork from your school loan servicers has you grabbing your hair, you may need assistance with student loan debt

Most Employees Don’t Get the Student Loan Help They Need

January 5, 2017 | Dori Zinn

Companies could be doing their employees a huge service if they offered some — and sometimes better — student loan repayment assistance.

Lift-Up program helps people get out of utility debt

Want Residents to Pay off Debt? Don’t Just Bill Them — Help Them

December 27, 2016 | Dori Zinn

National League of Cities gets those in debt to pay it back by giving them time, not money

6 Secrets to Help You Eliminate Debt Faster

#1: Interest charges only slow you down

The higher the APR on your debt, the more you must work to eliminate it. Interest charges eat away at every payment you make. And when it comes to credit cards, high interest rates eat up over one half of each minimum payment; if your rates are over 20% that jumps to two thirds of each payment.

The best way to accelerate debt elimination is to reduce the interest rate applied to your debt. If you can, then more of each payment goes to paying off the actual debt you owe (principal). You can get out of debt faster even if you pay the exact same amount or even less each month.

Start by calling your creditors or lenders to see if they will work with you to lower your rates. For credit cards, you usually don’t have to open a new account to get a better rate – they can just give it to you. On loans, you would need to refinance to achieve a lower rate.

#2: Consolidation simplifies and usually speeds up elimination

Debt consolidation is the process of combining multiple debts into a single monthly payment at the lowest interest rate possible. So, you get the benefit of lower rates explained in Tip One, while also simplifying your bill payment schedule. In many cases, consolidation can also lower your monthly payments.

Consolidating debt essentially allows you to pay it off more efficiently. Many debt consolidation solutions either accelerate repayment to lower total cost or lower your monthly payments or both. You can consolidate credit card debt, medical bills, payday loans, federal and private student loans and tax debt. In almost all cases, specific type of debt must be consolidated separately. So, you’d have one consolidation plan for your student loans, another for taxes and a third for credit cards.

#3: Settlement is not always the “fast” way out of debt

People often get the impression that debt settlement is the fast, easy way to get out of debt. It’s not.

The only way debt settlement can be fast is if you already have the funds necessary to make a lump-sum settlement offer. If you had that, you’d probably be making payments already. So, most people generate settlement offer funds by stopping their bill payments entirely to pool the money for a settlement. That takes time.

According to lending statistics, the average settlement case equals out to about 40 cents on the dollar. You basically have to pay back 40% of what you owe. So, if you owe $30,000, then you’ll probably need around $12,000 to settle. If you don’t have that kind of cash just laying around, then settlement still takes time.

#4: Don’t hide from creditors and loan servicers

Your creditors and loan servicers are not debt collectors – and they shouldn’t be treated like them either. Even if the creditor or lender has an in-house collections department for delinquent accounts, that’s not the same as a debt collector. And it’s in your best interest to talk to these people.

Debt collectors must follow the Fair Debt Collections Practices Act; in-house creditor collections aren’t required to follow the FDCPA. Why? Largely because it’s bad business to abuse your customers. If you fall behind with a creditor or lender, it’s in their best interest to help you catch up – it’s their money and they want to get paid; they also want to keep you as a customer.

So, creditors, lenders and even in-house collection departments don’t usually harass or threaten you. Instead they want to work out a repayment plan. They may be willing to offer forbearance (read more below) or work out a repayment plan (also more below).

Until your debt is charged off by the original creditor or lender and sold to a third-party collector, don’t hide! Talk to them and make arrangements to get back on track. It’s in your best interest and it’s better for your credit and your sanity than dealing with an outside collector.

#5: Don’t be afraid to ask for forbearance

Forbearance is a financial relief option where the lender agrees to temporarily pause your payments. You can essentially “miss” payments without incurring penalties or credit damage as long as you talk to the creditor first. They agree to let you miss a certain number of payments, which can give you time to recover.

Most people only know about forbearance as it relates to federal student loans. With those, you automatically have forbearance as you go through school. Payments generally start six months after you graduate or drop below half-time enrollment. Then you can apply for forbearance if you can’t make your payments after that.

What most people don’t know is that you can ask for forbearance on almost any other type of debt. Even your mortgage lender may offer forbearance if you can’t make your mortgage payments and risk foreclosure.

So, if you lose your job or can’t work for a period of time because of a medical issue, call and ask for forbearance. Not every lender will give it to you, but even getting forbearance from a few would be better than nothing.

#5: Arrange for repayment plans if money is tight

If forbearance isn’t an option, often creditors and lenders will work with you individually to set up debt repayment plans if you can’t afford your payments. If you lose your job or have a major life catastrophe that affects your budget, call your creditors to see if you can work something out.

Basically, you want them to agree to a reduced payment schedule for a certain period of time; it’s also beneficial if they’re willing to reduce or eliminate interest charges during that time. In exchange, you may need to agree to make “catch up” payments once you recover; they may also require you to freeze the account if it’s a credit card or open credit line.

If you can’t set up repayment plans on your own, work with a professional team. For example, if you need a repayment plan for credit card debt, you call a credit counseling agency. They can help you set up a debt management plan. Since you’re working with a third-party, creditors may be more willing to negotiate and work with you to catch up.