Here are some ways to eliminate your debt.

First, prioritize your debts. This means to list the creditors that would have the most negative impact on your life. An example, if your three months behind on your gas or electric bill, there is a good chance it could get shut off. So this would be at the top of the list.

Your next step is to have a list of all your creditors. This list should contain the name of the creditor, amount owed, amount of payment, due date and the amount of payments missed if any.

Step three is taking action. Never avoid creditors. Call your past due creditors and explain your situation. I know from experience that creditors will try and help you. Sometimes they can change your due date so it doesn't interfere with your mortgage or change it to a day that is closer to your pay day. You can also ask for a reduced payment by extending your loan. If this isn't possible most creditors will take a partial payment. A partial payment is showing that you are trying to pay something.

For more ways to reduce your debt especially when it comes to rent, mortgage, automobiles and utilities. Try negotiating with your creditor. For example, ask your landlord if the missed payment can be made at the end of the lease. You could also offer to do repairs in exchange for a reduction in your rent. Negotiating can used on all creditors. You won't know until you ask.

Mortgage lenders will sometimes waive late fees if you call ahead to let them know your going to be late. You can also refinance your loan with a lower interest rate and a lower payment. Here is a suggestion, try renting out your home for the amount of the mortgage payment and live somewhere that is less expensive.

Automobile loans can be flexible. You could call and ask for an extension on the loan or permission to defer a payment. If worse comes to worse you can always sell your car and buy a less expensive one.

Utility companies will work with you. Call and ask about budget billing or a budget plan. A budget plan will give you an average payment based on so many months of usage. This will avoid very high payments during certain months. Most utility companies will also accept a partial payment to avoid any disruption in your service. They will even put you on a schedule of lower payments just until you get caught up.

Just remember, most creditors will work with you. It is easier to negotiate a plan of action with the customer than to not get paid at all. Resolving debt issues can be a great stress reducer and a way to keep you out of any financial trouble later. By reducing debt, you will probably be able to free up some cash which might enable you to pay off a high interest loan. This will help eliminate some debt. The ultimate goal is to reduce your debt until you have none. Whatever your plan of action is, stick to it and refrain from using credit cards unless it is a dire emergency. Credit cards will only take you back into debt.

Learn more about this author, Lisa Angel.
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