First, is your family secure? Is the mortgage or rent paid? Is there adequate food for your family? Have the utilities (gas, electricity, water), insurance, and auto loan(s) been paid? Once these basic family-living type bills are paid, then consider the second level priorities which may include telephone bill, finance company debts, and credit card payments. The third priority would be retailers, doctors, dentists, and hospitals.
Are there services that you can discontinue to free up money for debt repayment? Some examples might include telephone, cable TV, cell phone, or some types of insurance. Looking over your list of creditors, determine which ones are the most likely to repossess items or attach your wages or put liens on property for non-payment of bills.
Above all, don’t ignore bills and past-due notices. Call all of your creditors to explain your situation and make arrangements to pay your debts. Make sure those arrangements are realistic, given your financial situation, because if you over-promise, those creditors will not work with you in the future. Some creditors may reduce the overall size of your debt (this is especially true of doctors and hospitals). However, if you ignore creditors altogether, your debt may be sold to a collection agency, which can be very stressful and is considered a very negative mark on your credit report.
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