CHICAGO, IL--(Marketwire - Jul 2, 2012) - As consumers across America celebrate Independence Day with family and friends at pool parties, picnics and BBQs, TransUnion reminds them to take this mid-year opportunity to also reevaluate their financial resolutions of 2012, recommit to healthy financial habits and begin celebrating their freedom from debt.
According to a recent JZ Analytics survey commission by TransUnion more than half (50.8 percent) of Americans surveyed said they are unhappy with their current debt situation.
"For those consumers unhappy with how much debt they owe, the good news is there are steps they can take today to reduce this burden," said Heather Battison, TransUnion's senior director responsible for consumer education. "The summer months are a great time for consumers to reevaluate their financial resolutions from January and recommit to practicing smart financial habits that can lead to living with less debt."
TransUnion offers the following tips to help get consumers on the path to lowering the amount of debt they carry. Lower debt levels can make consumers look better in the eyes of lenders, potentially reducing the loan rates they receive, which can equate to substantial savings on interest payments during the life of the loan.
Get the facts: Collect all your account, loan and credit information. Obtain your VantageScore® credit score to get a baseline for tracking your progress. Next, write down your total monthly income and list your estimated monthly expenses that don't appear on your credit reports, such as expenses you pay for with cash.
Do the math: Calculate how much you usually spend paying each debt and how much interest that debt collects per month. If you have available cash after paying all your monthly minimums, determine which debts need to be paid down first. For example, pay down credit card debt and any other high-interest rate loans or high annual fees first.
Debt negotiation and debt consolidation: Call your creditors and negotiate lower interest rates or move your balances to less expensive credit cards. Accounts that are above 35% of the available line of credit can potentially harm your credit score; pay off or move some of the balance to a different card. Debt negotiation and consolidation can be a very effective way to help you live with less debt.
Refinance: After taking control of your credit card and small debts, take a look at your major loans. Would it make sense to refinance your mortgage? Investigate debt consolidation programs? What about refinancing your auto loan?
Your debt reduction plan: Create a payment schedule and a monthly budget. See exactly how much you can afford to pay each month by subtracting your expenses from your monthly income. Divide the remaining amount between the accounts, paying the most to the debts with the shortest terms and highest interest rates. Create a payment calendar with the due dates and the payment amounts you just calculated for each bill. Sign up for automatic bill payment through your bank or register for online payments.
To stay on track, consumers should register for credit monitoring online and receive quarterly credit reports, credit alert emails and trending charts that outlines their progress over time.
To get started by obtaining your free credit score and to learn more about how you can live with less debt, visit www.TransUnion.com.
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