Five Tips for Paying Off Debt
While you can purchase a home with a low credit score, the process is going to be more difficult and your options will be more limited. By paying off debt, you can improve your credit score and get into a home with lower interest rates. We know this is easier said than done, but here are some tips to paying off debt that can help you with your financial goals.
1. Make a budget
Creating a budget can help you keep track of where your money is going and will help you make sure you don’t incur unnecessary expenses.
2. Pay off the most expensive debts
By paying off your debts with the highest interest rates, you’ll save money in the long run. Pay your minimums on other debts and focus on knocking out those pricey ones!
3. Find the little cuts
Maybe over time you’ve developed little spending habits, such as ordering coffee in the morning or grabbing a late-night snack at Taco Bell. See if you can find cheaper alternatives to these habits or if you can cut them out entirely. While each expense might not amount to much, overtime lots of small purchases can really add up.
4. Find a side hustle
A side hustle will add some extra income that can make a big dent in your debt. Some ideas include freelancing, pet-sitting, substitute teaching, food delivery, or tutoring.
5. Put your credit cards away
Try taking your credit cards out of your wallet and paying for things with a debit card or cash. This will help prevent you from overspending and you’ll be more aware of just how much money you actually have.
Taking control of your finances can be difficult and it may not always be fun, but getting out of debt is going to be very rewarding, especially as you watch your credit score rise and opportunities open up.
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