3 Easy and Simple Ways to Deal with Debt

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3 Simple Ways to Deal with Debt

Three simple and easy ways to pare down your debt.

When you get a loan, it is the kind of debt that you need to repay according to the schedule decided by the lender at the time of loan application. It is a simple scenario because you need to pay only one instalment every month.

However, if you rack up credit card debt and get other consumer loans such as a personal loan, education loan or vehicle loan, debt repayment gets a bit tricky. There are multiple payments going out at different times each month. And, the instalments may collectively start to burn a hole in your pocket.

Is there a way out? Yes. In fact, there are three.

Here are 3 simple ways to deal with debt:

  • Debt Consolidation: The first option is to take a single loan to pay off the debt. This process is known as debt consolidation and the loan may be referred to as a consolidation loan. It will reduce the stress induced by trying to keep a tab on multiple loan repayments to be made each month. And, if you find a relatively low-interest loan, you will end up saving some money too
  • Debt Settlement: You can negotiate a lower interest rate or principal amount with the lender. It will be beneficial if you can do it with each lender. But even if only one lender agrees to it, you are still going to get much-needed relief, which brings us to our next point
  • Debt Relief: If you are in a serious financial crunch, you can ask the lender to forgive whole or a part of the debt. This is a solution for extreme situations but it can be done. You may have to talk to a financial expert to execute it. Also, unlike the second option which may not reflect on your credit score, this one definitely will

A Final Word

Because of the COVID-19 pandemic, debt settlement and debt relief options may be far easier to avail of now than ever since the economy is under pressure and lenders are also facing financial issues. Things will improve but if you are facing a problem right now with your money, waiting a few months for things to normalise may not be a feasible option, and you should have a talk with your lender.

In normal circumstances, however, debt consolidation should be your first choice.

If you want to learn more about debt consolidation or consolidation loan schemes offered by other major Indian banks, you may check out our consolidation loans page for more information.

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