What is the connection between Patriot Funding and Georgetown Funding?
Patriot Funding and Georgetown Funding’s personal finance and debt consolidation offers are bait and switch and won’t help pay off debt. has begun flooding the market with debt consolidation and credit card relief offers in the mail with the website My Patriot Funding. The problem is that the terms and conditions are at the very least confusing, and possibly even suspect.
The interest rates are so low that you would have to have near-perfect credit to be approved for one of their offers. Best 2020 Reviews, the personal finance review site, has been following Patriot Funding, Credit9 Reviews, Americor Funding, Georgetown Funding, Silvertail Associates, and DebtBlue, etc.
Almost everyone suffers from the problem of repaying debt. It has become so common that it is now considered an epidemic. Regardless of what type of debt you owe, repaying it can be a large burden that is hard to get rid of. Paying off your debt requires thorough and careful management of your expenses and finances and prioritizing your spending. If you are not careful, interest rates may swoop in and hinder any progress you have made.
Getting out of the cycle of debt requires understanding debt and efficient money management. If you find yourself stuck in the uphill battle of repaying debt, continue reading our guide to know everything about debt and the strategies to use if you want to pay it off.
What is Debt?
If you want to fight off this enemy, it is best to first understand what it exactly is. Debt refers to something that one party, known as the debtor, owes to another party called the creditor. The debtor typically pays off the debt owed to the creditor over time.
There are many different types of debt. Some of the common ones include mortgage debt, credit card debt, student loan debt, medical debt, tax debt, etc.
Debt has a direct impact on your credit score through its effect on your credit utilization ratio. Your debt determines your credit utilization ratio. A high ratio will negatively impact your credit score. If you have a low credit score, you will not be provided with loans as you will not look good in front of potential lenders.
Details About the Debt You Owe
Another question to answer before diving into the strategies to pay off your debt is to figure out all the details of your debt, so you have a better idea of what you are dealing with. Answer the following questions about your debt to understand your situation:
- What type is it?
- What is the exact amount?
- How much interest do you need to pay?
- What is the minimum payment amount?
After gathering all of this information, figure out what your disposable income is. This refers to the amount left from your monthly income after you have paid all your monthly expenses, such as utility bills, grocery expenses etc. The disposable income that you have can be saved to pay off your debts.
Strategies to Pay Off Debt
You can employ various debt repayment strategies depending on your credit score, the amount you owe, and how much money you have. These include the following:
1. Debt Snowballing
If you have multiple debts, you can consider this strategy. In debt snowballing, you use your extra money to pay off the debt with the smallest balance first. So, you start with the minimum amount you have to owe and then pay the debt that has a larger balance, and so on.
However, this strategy is not that beneficial in the long term because it is likely that the interest rate will increase over time. This strategy, on the other hand, works well psychologically. Some people feel more relaxed after paying off a small debt, rather than saving up and paying a larger debt much later. In some ways, paying off the smaller debt provides more motivation to pay off the other debts.
2. Debt Avalanche
This is similar to debt snowballing; however, instead of using the extra money to pay off the debt with the smallest balance, you pay off the debt with the highest interest rate first. After you pay it off, you begin working towards paying off debt with the second highest interest.
This is a much better option as compared to debt snowballing because it saves more money on interest. Consequently, it will be easier for you to pay off the subsequent debts.
3. Debt Consolidation
This strategy combines multiple debts at the same time. By getting a personal loan or a balance transfer credit card, you can pay off all of your debts. It is also a simpler strategy than the ones mentioned above and can result in lower interest rates.
However, this option is not available to everyone. Only those people who have good credit scores can qualify for a debt consolidation plan.
4. Debt Management Plan
You can also opt for going to a credit counseling organization that will provide you with a debt management plan based on the type of debt and your credit history. They would additionally negotiate the debt repayment terms on your behalf with the creditors, although they cannot negotiate the actual amount for you.
Debt Repayment Options
You can also consider using any of the following debt repayment options:
Balance Transfer
If you have credit card debt and a good credit score, you can consider this option. It involves moving the balance from one credit card to another, ultimately consolidating your debts and lowering interest rates.
Personal Loan
This is another option that will consolidate your debts and which you can consider if you have a good credit history. In this option, you can apply for a personal loan to pay off your existing debts.
Debt Settlement
This is when you or your credit counseling organization negotiates with the creditor to pay off your debt with less of what you owe. However, you will need to pay the full settlement amount in one go if the creditor agrees.
Bankruptcy
Filing for bankruptcy should be the last resort if no other option is suitable for you. Although it will discharge your debt, it has a considerable adverse impact on your credit score that will last for years.
Final Words
Deciding what debt strategy to go for depends on several factors. If you have good credit history and score, we recommend consolidating your debt through personal loans or a credit transfer. However, if you do not have excellent credit scores, you can consider using the debt snowball and debt avalanche method.
If you are still unsure about what strategy to use, you can always call a credit counseling service that will guide you in deciding which is best for you.
Beware of debt consolidation scams that are popping up everyday.
