Compare costs and decide which loan will cost less over the period of the loan. Then calculate the total cost and how long it will take to pay off the original debts. Before taking out a consolidation loan, consider getting some financial counseling, she advised. The Consumer Credit Counseling Service offers free assistance to help consumers manage debt. A payment schedule with debtors can be arranged.
Consumers have smaller payments and more time to get out of debt.
Increase income by selling items that are not used or needed. A family member might get a job or a second job. Some families may be eligible for assistance such as food stamps to make it through tough times. The important thing is for people to reevaluate their lifestyles and consider where expenses can be eliminated or reduced, Wright said. Then set realistic financial goals that will help avoid debt in the future.