10 Warning Signs You Require Debt Help

American consumers have nearly $2.5 trillion of outstanding debt, according to the Federal Reserve’s Consumer Credit report. Unfortunately, the probability you account for a portion of that debt is high. Use the following 10 warning signs of excessive debt to know if you need financial guidance.

• You have been denied new credit. Lenders use your credit rating to determine the likelihood you will repay the credit they extend to you. If you have a large amount of debt, they are likely to reject your application or charge a high interest rate.
• You always make the minimum payments on your credit card debt. Your credit card debt will take decades to repay if you only make minimum payments, which is, typically, around 2 percent to 4 percent of your outstanding balance. For example, a $1,000 debt at 20 percent interest will take more than 26 years to repay if you only make the minimum payment each month.
• You have maxed-out one or more credit cards. One of the most apparent signs you have too much debt is when you reach your credit limit. Spending maximums are set by creditors to stop you from accumulating more debt than you can repay; however, you can quickly accrue overwhelming debt by maxing-out several credit cards.
• You ask friends and family for money to cover your credit card debt. Borrowing money from friends and family indicates you have overspent to the point you need assistance. Rather than jeopardizing your relationships, a viable solution is debt consolidation or debt settlement.
• You lease because you cannot find financing to buy. If the only possible way you can afford a home or car is to lease, then you have too much credit card debt. Leasing should be an option, not a necessity. It also reflects your credit rating, which suffers when you have excessive debt.
• You have three or more credit cards. The more credit cards you obtain, the easier it is for you to accumulate insurmountable debt. The solution to a maxed-out credit card is to repay the debt, not get another credit card.
• You have stopped putting money into a savings account. The first thing to go when you amass debt is usually your savings. You can tell your debt is at a dangerous level when you suspend your plans for the future to make a credit card payment.
• You hide your spending from your spouse and family. Money problems are among the top five reasons people get divorced. You will quickly lose the trust of your partner if he or she discovers you hiding debt.
• You don’t know how much total debt you have. When debt starts piling up, a common reaction is to ignore it. Your apathy prevents you from realizing the full extent of your debt and causes future hardships.
• You have seriously considered bankruptcy. Bankruptcy should be a last resort. If you have contemplated financial insolvency, then you are ready to explore debt-relief alternatives.

These are only a few indicators that your debt is a major problem. You should consider debt consolidation or debt settlement if your financial situation matches these warning signs. Debt relief is available, but you must take the first step and get help when the evidence points toward extreme debt.

Author Bio: Scott Sumerford has several years of experience working in the financial industry and has written a myriad of articles on various financial matters. Read more about how MyUSADebt offers a viable alternative to debt consolidation.