Behind on Bills? 5 Common Situations and How to Handle Them

Behind on Bills?

Regardless of how well we manage our finances, many of us face some financial crisis during our lifetime, many of which are out of our control. Unfortunately, some situations are overwhelming and may require the help of a professional. Here are some of the most common situations and general guidelines for handling them.

1. Behind on Utility Bill Payments

While these payments may typically be smaller than other kinds of debts, the timing is critical for delinquent utility payments because ignoring the situation will have dire consequences. Don’t be afraid to ask for leniency. Companies may even be willing to give you a lower interest or no interest period.

2. Behind on Your Mortgage

Getting behind on your mortgage payment can be very scary. It is likely your largest monthly bill, and it can be easy to find yourself in a seemingly insurmountable hole after just a few months. Most lenders will work with you by offering a period with a lower monthly payment.

3. Behind on Car Payments

Delinquent car loans are a different animal altogether. In many states, a creditor can repossess your car as soon as you default on your loan or lease. They can do seize your vehicle at any time Contact your lender as soon as you know that you may not be able to make your payment and see if you can work something out.

4. Behind on Student Loans

Getting help when you’re behind on student loan debt can be a challenge, and your options will vary depending on the type of loans you have. Federal loans through the Department of Education have programs that may help alleviate some of the pressure from default student loan payments.

5. What About When Your Debt Goes to a Collection Agency?

If you are blindsided by being contacted by a debt collection agency, the first thing you should do is contact the agency to make sure the debt is yours.  Also, make sure you do your research. There are rules that debt collectors must follow.

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