Are You OverExtended?

Are you managing your debt, or is it managing you? Practical guidance for managing personal debt and credit.

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  • Spending more than paying off
  • Trouble paying bills
  • Buying without down payments
  • Maxed out credit lines
  • Retirement not properly funded
  • No payoff strategy
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Recent Articles

The Link Between Your Budget and Your Credit Score
Personal Budget

The Link Between Your Budget and Your Credit Score

Most people think of a budget as a tool for restricting what you buy. But a budget does more than just keep your spending under control. It also...

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Why Financial Stress Hurts More Than Your Wallet
Financial Stress

Why Financial Stress Hurts More Than Your Wallet

When your credit card balance keeps growing and the monthly statement feels heavier than the last one, it is easy to think the problem is just...

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How Present Bias Can Hurt Your Credit Score
Behavioral Economics

How Present Bias Can Hurt Your Credit Score

Most people know that carrying a credit card balance is expensive. The interest rates are high, the payments stretch on for months, and the total...

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Creating a Personal Budget That Protects Your Credit Score
Personal Budget

Creating a Personal Budget That Protects Your Credit Score

When you think about your credit score, you likely picture credit card companies, loan officers, and interest rates. But the truth is that your...

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Popular Articles

Recognizing the Red Flags of Unsustainable Debt in Adulthood
The Difference Between Front-End and Back-End Debt-To-Income Ratios
Is Buy Now, Pay Later a Modern Form of Credit?
Video

Consumer Credit Tips

Each video breaks down one practical way to get out from under debt and stay there — straightforward advice on credit, budgeting, and the habits that keep you from getting overextended again.

FAQ

Frequently Asked Questions

Individuals may not know methods like the debt avalanche (paying high-interest debt first) or snowball (paying small balances first) methods, so they pay debts inefficiently, costing more time and money.

Debt collection is the process of pursuing payments of debts that are past due. This is typically handled by a third-party agency that specializes in collecting delinquent debts on behalf of the original creditor, often after the creditor has charged off the account.

This strategy involves making minimum payments on all debts but putting any extra money toward the smallest debt balance first. The psychological win of paying off an entire debt quickly provides motivation to continue.

It can change it. If you use a new installment loan (a consolidation loan) to pay off multiple revolving accounts (credit cards), you are trading one type of credit for another. This may slightly lower your mix diversity in the short term, but the huge benefit of lowering your credit utilization and simplifying payments is far more valuable.

Lenders may offer three loan options: a short-term with high payment, a long-term with a very high total cost, and a "decoy" option in the middle. The decoy makes the expensive long-term loan appear more reasonable by comparison, steering borrowers toward the most profitable option for the lender.