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What to Do if You Can’t Pay Your Bills
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Jeffrey Strain | MainStreet.com
Lacking the cash to pay your bills is a bad situation, but avoiding the problem is worse.
If money is scarce and bills are coming due, don’t panic. Gather your statements and a calculator, and go into planning mode. Tackle the crisis as a whole, rather than dealing with issues as they arise, which raises the risk of making poor financial decisions that could affect you for years to come. As you pull yourself together, keep these five crucial steps in mind:
1. Call the companies you owe
People faced with a budget shortfall will often try to avoid the companies they owe. They simply stop paying without giving a reason. But you should always call your creditors to alert them of your predicament. They might be willing to negotiate a compromise that will resolve the situation.
2. Prioritize your bills
One of the biggest mistakes people make when money is short is to try to be “fair” when paying their bills. If they can only afford to pay one bill, they pay one this month and a different one next month. It might seem like a logical solution, but they could hurt their credit scores and anger the companies they owe.
Some bills are more important than others. Prioritize your creditors and then pay them accordingly. Your mortgage lender should be at the top of the list.
gguranich
5 months ago
4 comments
If you cannot afford the mortgage and utilities contact the utilities, they can set you up on payment plans which spread your total owed over several months so you do not fall far behind, just make sure to keep your payment on the schedule or they will cancel the deal. Once caught up consider a plan that gives you a set $ amount each month instead of varied monthly payments. Gas bills and electric companies will look at how much you use yearly, divide it by 12 and give you a set monthly cost instead so that in the winter you are not caught with a $400 bill. I would rather pay a set $140 every month and not fall behind when the weather changes. it is so much easier when you set up you budget.
gguranich
5 months ago
4 comments
Never avoid your creditors. It results in extra charges added monthly onto your balance and before you know it your debt owed is $$$ of dollars more than originally owed. If you are in a financial pinch contact a debt counseling agency such as CCCS financial services and they will bargain with all your creditors to make sure you can afford your payments and get you to a finacially sound place within 2 to 5 years.
melco75
5 months ago
70 comments
Ok.. your mortgage lender should be at the top of the list? What if you are getting your utilities shut off? Your mortgage can go up to 6 months or more late and they won't throw you out, but you can't go more than a couple months before the utilities shut you off. I need to have electricity in the home to live there.
This is from experience in the last couple months of not having a job and just recently started a new one, so I'm good now. But when I had to choose between my electric and my mortgage.. I definitely thought the hot water and stove/oven, etc. was more important at the time.