Paying Your Debts – The Essentials Come First

It stands to reason that some debts take priority over others as they are more important than others. If you are struggling to pay your bills, it’s perhaps time to make a list of priorities. Then, be sure to pay off the essentials first.

 

Essential Debts

If you decide to let an essential debt go unpaid, there could be some very serious consequences.

 

Rent

Payment of your rental should be a top priority unless you know that you are going to relocate to someplace else pretty soon.

Mortgage

If you’ve had a financial setback such as losing your job, think through the pros and cons attached to selling your home.

Reasons to sell: You could rent a place that is moderately priced and use what is then left over as a way to pay any other essential bills.

Reasons why not to sell: If you believe your home is going to be worth more in a year’s time, you might think about waiting it out.

Child support

If you fail to pay your dues on child support, you could end up in jail.  A debt pertaining to child support will never go away – it cannot be wiped by a bankruptcy and it does not expire. So, you will have to pay it sooner or later.

Utility bills

If you live without a supply of electricity, water, gas, and/ or telephone, it’s not a safe position to be in. These bills should be near the very top of your list.

Car payments

You may need a car for your job, so you should always make payments. Otherwise, think about selling it.

Other secured loans

A secured debt is one whereby an item of property, which is known as collateral, is used as a guarantee of a debt repayment. If the debt is unpaid, you’ll likely face the loss of your property. Stay up to date on your payments if your property is something you’re unable to live without.

If you’re not overly concerned about the loss of your property, or if you are confident that your creditors are not interested in having it, there’s no real need for concern should you miss out on a couple of payments. Nevertheless, defaulting on a loan or the repossession of property will remain on your credit report for a period of seven years, and in which case, it could prove difficult to obtain a future line of credit.

Unpaid taxes

If you know that the IRS is going to take your bank account, paycheck, your home, get in touch and set up a repayment plan.

 

For further information pertaining to bankruptcy, get in touch with Harrison VA bankruptcy lawyers.