FREE HOMEBUYING ADVICE (855) 493-4002

Homeownership Guidance, Advice and Blogs

As the Director of Affiliate Relations at HomeFree-USA, I’ve always been fascinated with how people handle their money. Like everyone else, I’ve had my financial ups and downs. In fact, it took me 32 months to pay off $32,000 in credit card bills and build up a six-month emergency fund. While that was a very difficult period, I am grateful – and wiser -- for the experience.

Through my personal experiences and working at HomeFree-USA, I’ve gained a ton of insight that I feel compelled to share. You’ll find those lessons here. Feel free to take the thoughts and ideas that resonate with you most and put aside the rest for later. I look forward to sharing my journey.

Six steps to getting out of debt

I decided to get out of debt because I didn’t like the feeling of being indebted to a company with no real tangible benefits. My credit card debt was a glaring reminder of my lack of discipline, and I was willing to make sacrifices to get rid of it.

I truly believe that when you put something you really want out there, it will come to fruition. A few months after I made the decision to get out of debt, a financial break came and I was able to move forward using the following tactics:


Step One. I set a debt pay-down schedule and kept it above my computer at work so I’d never forget. I crossed off each month as it came.


Step Two. I opened three credit cards under a 0% balance transfer offer and spread out the debt I’d incurred on my two original cards to all five. I used this tactic because your credit score increases when credit card balances are 30% or less of the total limit. My total debt spread across the five cards was far below that amount.


Step Three. I cut up all five cards. The three new ones were a tool, not a means to acquire more debt.


Step Four. I paid down the debt based on the expiration date of the 0% rate. On the remaining I made minimum payments. Once the debt on each of the new cards was paid I closed the account. A new account doesn’t have an impact on your credit like an old one does.


Step Five. I got a side job. Every dollar I made went to paying off debt. 

 
Step Six. I found every means of cutting expenses I possibly could, even when it meant saying ‘no’ to things.


In the last six months I ran out of steam. Yet again, the universe conspired to give me the lifeline I needed when I happened to pick up the book The Total Money Makeover by Dave Ramsey. That encouraged me to listen to his radio show. The very first day I heard people call in and excitedly tell Dave how they’d paid off thousands in credit cards, student loans, medical bills, even mortgages. That gave me all the motivation I needed. The last payment of my $32,000 debt was made on August 4, 2010. On October 15, 2011 I finished building my six month emergency fund.


When challenges come about many say ‘I can’t.’ But it is the truly committed who say ‘how can I…’


And so it is.

Back