Credit Repair

Money is, for most people, one of the biggest issues in their lives. It's all about how much you make, how much you spend, what you have, how much you have saved. Thinking, worrying, stressing, planning, hoping and dreaming about money take up a huge percentage of our mental space.

For people with bad credit, having massive anxiety about money can take up 100% of their mental space because their situations have become so dire and their creditors so insistent that it's not possible to think about anything else. When your credit report is bad, you know you're paying for it in psychological terms and you're also going to be paying for it in other ways. When you've got bad credit, life can become unbearable.

If you've got a bad credit report, you may have arrived at this tough, anxiety-inducing place through no fault of your own.

Perhaps you had no health insurance, and you got sick or injured. Or maybe your auto insurance lapsed, and then you got into a bad accident that resulted in huge bills you could never possibly pay off. Other people get too many credit cards with sky-high interest rates and then rack up massive debts that literally crush them and their futures.

However you may have incurred your bad credit report, it's going to prevent you from borrowing money ever again and that can mean your most cherished dreams will never be realized. No mortgage loans approved means no dream home for you and your young family. No student loans approved means no career advancement, and a grim future stuck in a low-paying, dead-end job. No car loan approved, and you're at the mercy of public transportation, or a series of "beater" cars that are constantly breaking down and driving you crazy. With a bad credit report, you can find yourself stuck with no way of getting any relief or chance of a better life.

The good news is that debt counselors and credit counselors can help you begin the process of fixing your bad credit report. They're ready to go to bat for you and help you figure out solutions to your credit problems.

Dealing with any type of stress can be difficult, but dealing with financial stress can add to your already pressure-filled existence. As soon as you realize financial stress is a problem, it's good to start relieving the pressure. However, you need to know where the stress is coming from. So let's look at some common causes of financial stress and how you might deal with them.

Debt

Having a pile up of debt can cause significant financial stress. While it may seem that debt is really the creditor or lender's problem, the burden is most definitely yours. Whether you have a low credit score preventing you from a loan, car, home or you have creditors hounding you to pay your bills, the stress can take its toll on you.

Here are a few solutions to help resolve the problem:

• Credit counseling - A credit counseling agency offers advice on how to better manage your expenses. The agency may contact creditors on your behalf to help lower your payments.
• Debt settlement - A debt settlement company contacts your creditors on your behalf to come up with a significantly-lowered one-time payment for you to pay to settle your debt.
• Debt consolidation - A lender pays your debts for your then consolidates them into one neat bill that you pay down in monthly payments - with interest.
• Bankruptcy - By filing Chapter 7 (total liquidation of your assets) or Chapter 13 (come up with a payment plan) bankruptcy, you relieve yourself of your debt. Bankruptcy leaves an ugly mark on your credit report though.

Unemployment

Unemployment can cause significant financial strain, especially if you were not warned of this impending doom. Millions of workers laid-off workers know all too well the difficulty of unemployment.

However, if you've been laid off, you can take advantage of unemployment benefits for up to half the year. Also, Congress is working to extend those benefits, so take advantage of them - and take time to review your budget to find reasonable areas to cut back (eating out, subscriptions, shopping, etc.).

Expensive Insurance

Maintaining expensive auto, life, health or homeowners insurance can be a definite source of stress. However, it's good to know that you can find less expensive alternatives by looking for discounts with your own company, or simply comparison shopping online for a new provider.

Mortgage

If your mortgage is becoming too much to handle, it can cause significant stress. One way to resolve the issue is to talk to your lender about a temporary reprieve (interest rate decrease, deferred payments, part of principal forgiven). If your mortgage is high enough and you have little-to-no income, it can be impossible to keep up. So, try to work with your lender to see if your financial strain can be relieved.

Keep in mind that more than one common cause of financial stress may apply to you. The more causes you have relating to your life, the harder you will want to work to alleviate those strains. Financial stress can cause as much damage as a physical strain, so the sooner you move toward a resolve for your finances, the easier it will be for you to manage your life.

We've been getting a lot of questions about how debt repair really works. Sometimes, it can be tough to know exactly how to get out of debt, so we asked a company, Simplified Debt Solutions, to give us the 411.

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