Networks To Help Women In Debt

There are many reasons women fall into debt. Student loans, credit cards and mortgage payments all contribute to the debt load many women carry.

While paying off debt can be challenging, the Internet has made it easy for women to access networks and resources that can help them become debt-free. Some networks aimed particularly at women in debt include the Women in Red Racers, the Women's Financial Network, and Debt Help for Women.






Women in Red Racers

The Women in Red Racers is an online network of more than 1,000 women from throughout the world who exchange advice on getting out of debt. Its name comes from the idea that each individual in the group is racing to pay off her debt as soon as possible. The group primarily interacts through message boards hosted by MSN Money. To join, members must disclose their general financial information and post updates on how well they are doing at paying off their debt. According to Good Housekeeping magazine, the community provides tips, feedback and encouragement for women and has helped its members pay off millions of dollars in debt since 2006.
   
Women's Financial Network

The Women's Financial Network is an online organization affiliated with Siebert Financial. It provides women with free tools needed to make educated financial decisions. The network offers an online course that helps women identify their debt problems, take action to reduce their debt and stay out of debt. In addition, the Women's Financial Network provides women with links to further reading, debt calculators and free debt-management worksheets.
   
Debt Help for Women

Debt Help for Women is a network that works with women to help them reduce their substantial credit card debt. It offers a free telephone consultation in which women can receive advice on reducing their debt quickly. By utilizing attorneys in this process, Debt Help for Women is able to come up with effective solutions and start women on a debt-free path. According to the network's website, women must live in an eligible state and have more than $10,000 in credit card debt to utilize its services.


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Can A Mortgage Help Pay Off Credit Card Debt?

Credit card debt may accumulate to a point where you can't easily pay off the amount you owe. When this happens, you may have to take drastic action. If you have equity in your home, you may benefit from refinancing your mortgage and using your equity to pay off the credit card debt.

However, this has certain risks, with which you may not be comfortable.





Interest Rate

Finance professionals often recommend you start by paying off the debt with the highest interest rate and gradually work your way to the debts with lower interest rates. In most cases, credit card debts carry the highest interest rates. It may make sense to pay off your high-rate credit card debt with proceeds from a mortgage, which usually carries a low interest rate. Over time, this strategy may reduce your interest costs.
   
Reduce Debt Burden

If you have some equity in your home, you may get cash by refinancing your mortgage or getting a new home equity line of credit. For example, you still owe $100,000 and your home is now worth $200,000. Lenders may allow you to borrow $150,000 against your home. You may choose to use the
$100,000 to pay off the old mortgage and take the $50,000 as cash. The $50,000 may go toward paying off your credit card debt. This strategy may dramatically reduce your debt burden.
   
Costs

Getting a new mortgage loan may require you to pay high processing costs. Refinancing may cost thousands of dollars to process. For example, if you owe $20,000 in credit card debt and have to pay $3,000 to refinance, you will spend 15 percent of your credit card debt. This money can go toward paying off your credit card debt instead. While a home equity line of credit costs less to process, you must still come up with cash for the closing costs.
   
Risks

Because the new mortgage erases your credit card debt, you may be tempted to spend money using your credit card again. If you use a mortgage to pay off your credit card debt, you effectively convert the unsecured credit card debt into a secured debt -- your home loan. If you then can't afford to pay your mortgage, you may lose your home in a foreclosure. The Motley Fool website recommends that you continue to pay off your credit card bills regularly, at least until you pay off your mortgage.

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How to Use Personal Loans to Pay off Massive Credit Card Debt

If you have massive credit card debt, you should know that you're not alone. Millions of individuals around the world are suffering with overwhelming credit card debt that is threatening to pull them under. If you're looking for a solution, here is some information on how to use personal loans to pay off massive credit card debt.
  
Instructions:

1.  Gather All Credit Card Bills. The first thing you need to do is gather all of your credit card bills so you can determine exactly how much money you will need to pay off your credit card debt. Make a list of each credit card, the balance owed on the card and how much the interest is. Once you have gathered every single bill, add up the balances so you will know exactly how much credit card debt you have.
      
2.  Speak with Your Bank or Credit Union about a Personal Loan. Depending upon your credit history, loan history or debt to income ratio - you may need collateral for a loan. Speaking with a representative of your local bank or credit union will help you determine whether this is needed or not. Explain to them how much you need and what you can offer as collateral if needed. When you are told how much you are approved for, you can further determine how to use the money to pay off your credit card debt.
      
3.  Create Priorities. You may or may not be able to receive a loan that is high enough to cover all of your credit card debt. If not, you will need to create priorities. Look again at your list of debts and pay special attention to the cards with high interest rates. They should be paid off first. Pay off the credit cards that you can - paying the highest interest cards first. This will help you save money in the long run. You will have only one payment (the loan) rather than several and most likely it will be a fixed rate rather than a variable one.

4.  Pay Off Your Credit Cards. Now that you've determined which credit cards to pay off, or if you will be paying them all off, you need to do a few extra things. Send the money in a money order or check so you will have proof of the transaction. If possible, send the money certified mail so you will receive a receipt when the mail has been signed for and delivered. Also, send proof of the payoffs to all three major credit bureaus. These are TransUnion, Equifax and Experian. This will help insure that the information makes it onto your credit report and that the credit bureaus are aware that you've paid the debts off.
      
5.  Cut Your Credit Cards in Half. Okay, so this is an optional step, but it's important to learn how to manage credit cards. It's all to easy to end up overwhelmed by credit card debt again and be back in the same situation you were in to begin with. Consider credit counseling or something similar to empower you and give you knowledge about credit concerns.

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Consumer Debt Relief Tips

Relieving yourself from consumer debt will allow your money to grow.

It doesn't take long to get into debt, but trying to pay off consumer debt can be overwhelming. Being in debt creates stress and frustration and prevents the consumer from living life to the fullest. There are strategies to help those in debt begin to pay off credit card balances and to avoid consumer debt in the long run.

Pay Down Debt

It is important to stop using credit cards when you are trying to decrease your debt. Pay as much as you can on the card that holds the highest interest rate and pay the minimum balance on all other cards. When that card is paid off, use the same method on the card holding the next highest interest rate. This strategy protects your credit score and allows you to feel success as each card is paid off. If you do not have extra funds to begin paying down your debt, consider taking a part-time job and use your paychecks exclusively for paying off debt.
   
Debt Negotiation

Another strategy is debt negotiation. Contact creditors in person or by phone to try to get interest rates lowered on the high-interest balances.  You may qualify for this if you can prove you are currently facing a financial hardship. Creditors do not have to lower their rates, but it may be in their best interests if it allows the consumer to pay off the balance.
   
Debt Consolidation

Consolidation combines smaller debts into one larger loan with only one payment per month. Debt consolidation turns unsecured debt into secured debt. The debt becomes secured by the consumer's property, which may be seized if the consumer fails to pay.
   
Credit Counseling

Credit counselors assist those in debt to develop budgets. They advise on managing money and may provide follow-up workshops or other sessions.  It is important to research credit counselors carefully and not to do business with anyone who charges high fees. You do not want to get further into debt.
   
Adjust Attitude Toward Spending

Think about the underlying causes of getting into debt. Are you spending as a form of recreation or to make yourself feel better? Once your debt is paid off, you do not want to adopt the same spending pattern as before. Living within your means is healthful for your bank account and for your emotions.

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