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Paying Down Debt? Why You Need a Credit Check

iStock_000008800185XSmallBefore even thinking about getting out of debt, you should find out your credit scores and your credit reports. Not factoring in this information can affect your get-out-of-debt success.

Seeing What You Owe

Being armed with your credit scores and your credit reports will give you a good starting point for your debt repayment plan. You will be able to see all that you owe and who you owe it too. Sometimes when we are in major debt, we concentrate so much on just getting the monthly payments in that we underestimate the amount of debt that we have, or we prioritize the wrong debt. With the credit report right in front of you, you will be able to catch anything that you might have overlooked.

Overcoming Your Fears

When you are in debt, ordering your credit report and credit scores and then reviewing them can be scary. Sometimes it seems easier to ignore the bulk your debt, so staring it in the face may be intimidating.  Getting this review over with quickly means that this information will no longer be hanging over your head. You can see where the problems are and address them before they get any worse.

You also may be surprised to find that things aren’t as bad as you think. Either way, overcoming your fears of facing your debt is the first step to managing it.

Understanding How Your Debt Affects Your Life

Making payments on time means that you have good credit, right? Not necessarily. Until you look at your credit report and your credit scores you won’t know for sure. Your debt to asset ratio may be dragging your credit score down. So may old accounts that were never officially closed. If your credit cards are near their limits, that will lower your credit score as well. Understanding how different approaches to repaying your debt can affect your credit score is important in order to increase that score. You can’t do that without having these reports in hand.

Tracking Your Successes

Paying down debt can take a long time, so it is important to stay motivated and encouraged. One way to do this is to regularly check your credit reports and your credit scores to track how your credit is improving, as you pay down your debt and rebuild your financial future. Positive reinforcement helps in this long-haul goal. Keeping track of your progress will also allow you to make some changes to your debt repayment strategy if needed.

This entry was posted in Get Out of Debt and tagged , , by Mary Ann Romans. Bookmark the permalink.

About Mary Ann Romans

Mary Ann Romans is a freelance writer, online content manager, wife and mother of three children. She lives in Pennsylvania in the middle of the woods but close enough to Target and Home Depot. The author of many magazine, newspaper and online articles, Mary Ann enjoys writing about almost any subject. "Writing gives me the opportunity to both learn interesting information, and to interact with wonderful people." Mary Ann has written more than 5,000 blogs for Families.com since she started back in December 2006. Contact her at maromans AT verizon.net or visit her personal blog http://homeinawoods.wordpress.com