Lethbridge Debt Consultation Expert -Darrell Pauls

Do You Need Debt Help?

Do you know how much debt you have? Do you need debt help? If you aren’t sure, keep reading to find out.

The first thing you need to do is find out how much money you owe. Gather your statements for every credit card, loan agreement, student loan, line of credit and personal loans from friends or family. Add up the dollar amounts from the total on each statement and find out how much you owe altogether. It is important to have an idea of where you are starting so that you can see your progress in paying off your debt.

Second, look at what the fixed monthly payment or minimum monthly payment is for each debt and add them up. Include your mortgage or rent in this category. For loans from a financial institution you will most likely have fixed payments each month. Your minimum payments on your credit cards may change from month to month depending on how much you owe and how much you paid or spent the previous month.

Add up each debt and make a total of what you pay each month.

Next take the gross total amount of money that you bring in each month. Include your spouse’s income as well as any additional income you may have. Add it all up to show your total family income.

Take your total debt payment amount and divide your total income into it to get your debt to income ratio. For example if your total income was $5000 and your total monthly debt payment was $2000 your equation will look like this:  $2000/$5000 = 40%

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