Being a single parent has a host of complications and when debt is added to the mix, the burdens to bear can sometimes be unbearable. Single parents often struggle on a single income without help from anyone else. They have the responsibility of making all the financial decisions for a family with help of a partner. Single parents often have higher debt amounts than other demographics of consumers. For this reason, it is important debt is never ignored but tackled head on to prevent further complication down the road.
It will be a tough journey but is debt relief is something any consumer can accomplish with a little focus and lots of effort. Here are some debt relief options geared towards single parents:
Home Equity Loans/ Personal Loan
If you are struggling to make ends meet but have managed to keep your credit score in good shape and own your own home, a home equity loan can be an option to help eliminate some of your pressing debts. You will need to have sufficient equity in your home to seek such a loan and you will also need to have a plan to repay the loan on time. You can potentially lose your home if you default on this loan so be certain you have a financial plan in place. If you do not own a home but have good credit and sufficient income, you may be able to qualify for a personal loan from your bank.
Debt Consolidation Programs
There are debt consolidation programs outside of a mortgage loan that can help consolidate most of your monthly debts into one single payment. It will cost you fees to enroll in such programs but having a third-party deal with your creditors and orchestrate the smaller consolidation payment can take some pressure off your shoulders and allow you to catch up and eliminate your existing debts.
Debt settlement is an option to consider. This strategy involves either a third-party or your own efforts for contacting your creditors and negotiating a lump sum payment to eliminate your entire debt that is less than what you actually owe. This strategy will also cost you in fees if you go with an agency for help and your credit score will likely take a tumble as it is notated you are paying less than owed.
Bankruptcy is something that requires serious thought before moving forward. In most cases, bankruptcy action should only be considered when debts are insurmountable. Because of the changing laws in bankruptcy courts, you may not be able to include all of your existing debts. Those debts that may be dismissed in a bankruptcy ruling will require your presence in court and likely you will be challenged by your creditors before debts can be dismissed. You also should consider the expense of hiring an attorney to assist you in the process.
As a single parent, it is imperative that you work on better money management to prevent such debt issues from disrupting your life in the future. Institute a budget and cut costs where you can. There are many resources you should investigate to save more money and stop spending where you can. The more educated you are about your personal finances, the better chance you stand of making ends meet.