How can I Repair Errors on my Credit Report? Credit Repair After Bankruptcy Working with Creditors Avoiding Financial Mistakes Steps to Take to get out of Debt Mortgage Refinancing What is Credit Counseling? Avoiding Credit Repair Scams After Bankruptcy Hiring an Attorney to Help Repair Credit Life After Bankruptcy Start Fresh with Bankruptcy

Working with Creditors

If you are facing financial hardships, you may be tempted to ignore your problems or hope that someone else can make them go away. This only makes problems worse as many over-burdened homeowners fall prey to scams and con artists that can make a financial crisis go from bad to bleak (see Recognizing Foreclosure Rescue Scams). There are several things that you can do, that won’t cost you any more money than you already owe, to help get you through financial difficulties.

Contact creditors right away
When you miss a payment or know that you are going to miss a payment, contact your lender right away; the best way to do this over the phone or in person. Do not wait for them to send you a past-due notice or other notice of delinquency. Contacting your creditors and being open with them about your financial situation demonstrates sincerity and makes it easier for your lender to extend grace or renegotiate the terms of your repayment.

Be honest with creditors
Being honest about your situation may enable you to work out a solution with your creditors that is actually feasible for your budget. If you have lost your job and know that you will not be able to make payments for awhile, tell your creditors. Creditors are generally willing to work with people to come up with reasonable repayment plans—and you can negotiate this yourself (see Avoiding Credit Repair Scams and Recognizing Foreclosure Rescue Scams).

Be polite with creditors

Treat your creditors with the utmost respect and approach them with politeness. Do not demand assistance from your creditor. Remember, your creditors are in a power position and you are the one seeking grace. Making polite requests instead of aggressive demands can make or break your negotiations with your creditors.

Ask what actions may be taken against you if you miss further payments
It is important to be aware of exactly what your creditors may do if you continue to miss payments. This can help you prioritize your bills as you prepare for the future. Sometimes, property may be repossessed, your account may be closed, or a third-party collection agency may be used to collect money that is owed. Understand what might happen if you cannot make future payments so that you know what to expect and can develop a plan to avoid the worst-case-scenario.

If you have done all you can to work out a repayment plan with your creditors and are still falling behind on your monthly bills, it is a good idea to contact a bankruptcy attorney. A bankruptcy attorney can tell you about the different types of bankruptcy and debt relief available to you, and help you find a solution that is best for your situation (see Should I File Bankruptcy?).