The following is guest post by Jason of Debtconsolidationcare.com. To submit your guest post email Robert [at] vabenefitblog [dot] com.
Several veterans are struggling with financial debts in our country. In fact, recent studies have found that around 40% of the veterans are finding it extremely difficult to pay off their debts whether mortgage or unsecured. Veterans can pay off debts with the help of credit consolidation loans. But, is that the only way? Not really! Let us know some effective ways by which veterans can pay off their both mortgage and unsecured debts in a better manner.
How to pay off unsecured debts
Here are some easy and effective ways with the help of which veterans can pay off their unsecured debts:
- Stay within your means: First of all, veterans need to spend less than what they earn. They have to realize that they can’t buy anything they want and pay it off later. Rather than sticking to a budget, they can use cash or a debit card for necessary purchases.
- Pay what you can: The ultimate goal should be to pay off credit cards each month. The best strategy will to be to pay as much as they can on the highest interest cards. Simultaneously, veterans should try to make minimum payments on other debts. When the first debt is wiped off, they can utilize the same strategy on the next-highest-rate debt.
- Take advantage of VA Disability Compensation: Veterans who have suffered from a disability while in active services can apply for a VA Disability Compensation. This government program was introduced to help the veterans with several finances. The government will also give extra funds in addition to other regular benefits depending on the severity of their disability. These extra funds can be utilized to reduce debt.
- Get help with student debts: The Survivors’ and Dependents’ Educational Assistance Program has been introduced by the government to help veterans and their dependents to complete college education. Also they can take the advantage of GI bill which allows servicemen to pass their education benefits to children.
How to pay off mortgage debts
Here are some ways with the help of which veterans can pay off their mortgage debts:
- Contact lender: It is better to contact lender and explain your trouble. They can offer an alternative repayment plan for getting current on their payments. If veterans are willing to cooperate, the lender can help you develop a plan that will allow them to keep your home.
- Contact VA regional loan centers: VA Regional Loan Centers have expert technicians to give financial counseling to the veterans who have incurred mortgage debt. This counseling is designed to help veterans avoid foreclosure. Therefore, veterans should contact a Loan Service Representative immediately.
- Know the Service Members Relief Act (SCRA): According to this Act, mortgage lenders have to reduce the interest rate to by 6% per year during the period of active military service. Mortgage lenders can’t foreclose a property for a failure to pay a mortgage debt, when a service member is on active duty or within 90 days after the period of military service without the prior approval of a court.
- Veterans Benefits Improvement Act: This Act allows any qualifying veteran to refinance up to 100% of the LTV (Loan to value) of their current home mortgage using a Cashout VA Refinance.
Finally, veterans who want to consolidate their monthly debts (secured or unsecured) can take out loans for the purpose of credit consolidation. These loans can help them to reduce their monthly obligation by combining all the loans into one low rate fixed loan.
Photo thanks to AllenCleaver under creative common license on Flickr.