Thomas F. Miles, Attorney and Counselor at Law
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Tips for handling unmanageable debt

When an individual's level of debt has passed his or her ability to pay, a high level of stress and anxiety kicks in. Often, debt grows over time, and many people are unaware just how serious the situation has become until something triggers a closer look. Once unmanageable debt is in place, it can be very difficult to regain control over one's finances. The following suggestions may offer assistance to some in California who are trying to gain the upper hand on mounting debt.

The first step in gaining control is to make a comprehensive assessment of all outstanding debt. This involves gathering current account statements for all lines of credit, both open and closed. From that point forward, debts can be prioritized and paid down in a strategic manner.

Secured debts should be paid first. A secured debt is one that is "secured" by the asset it was used to acquire. Mortgages and auto loans are common examples of secured debts. By paying these accounts first, consumers can avoid a negative spiral that often follows a foreclosure or car repossession.

Next comes lines of credit with high interest rates, such as credit cards. Paying these debts down will bring savings over time, as interest charges will have less time to intensify. Next on the list should be any remaining student loan debt. If paying down student loans is a problem, individuals should contact their lender to look into payment options and the possibility of deferment. Finally, debts with low interest rates or smaller balances should be paid off.

By taking a strategic approach, many California consumers are able to gain control of unmanageable debt and regain financial stability. In some circumstances, however, repayment is simply not possible, no matter how motivated or aggressive a consumer might be. In such cases, filing for personal bankruptcy may offer a faster and more effective path to a debt-free future.

Source:, "Prioritize your debts to pay off bills the smart way", Andrew Housser, June 1, 2015

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Thomas F. Miles, Attorney and Counselor at Law
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