Credit and Debt

Understanding Credit

Credit gives you the ability to purchase larger items when you don't have the money available or that would be outside your reach otherwise, such as a home or a car. It involves borrowing money with the understanding that you will pay back what you borrowed over time – usually with interest added. Using credit also helps you build your reputation as a borrower.

Reduce your Expenses

Reducing your monthly expenses helps you make the most out of every dollar you earn and frees up more cash flow in your budget. It also helps you avoid financial distress so you don't have to struggle to make ends meet. The following strategies and tips can help you reduce your monthly spending so you can save money and achieve your financial goals faster.

Getting out of Debt

Debt consolidation can help you find relief from your credit card debts by reducing your interest rates and easing the monthly burden of your debts. However, there are a number of options available when you decide to consolidate your debts.

Credit Problems: Collection Agencies

Collection agencies are in business solely to collect money. While many of these agencies have not studied politeness or manners, these agencies are legally able to harass and pressure you for amounts owed.

You do have certain rights as a debtor:

Credit Problems: Judgments and Wage Garnishments

After a judgment is entered against you in court, what happens? First, a sheriff or marshal or other state authority may notify your employer of the judgment and the garnishment. Depending upon the state, the amount garnished will vary, but it is usually a percentage of your paycheck, less certain exemptions offered by state law.