Welcome to the Debt Relief Journey blog!

Debt has become an epidemic in America. People think that the only way they can buy things is by financing them. But that is not the case.  Learn more about debt in today’s initial post on the Debt Relief Journey blog!

This blog is a companion resource to the FREE Budgeting Essentials: Debt Relief Workshop.  If you are interested in that FREE class, click HERE to sign up!

Each Monday I will have a new post on debt relief.

Debt has become an epidemic in America. People think that the only way they can buy things is by financing them. But that is not the case. When you finance an item you pay too much for it. Even when you negotiate a discount on the list price, by the time you get done paying for it, you normally have exceeded what the original price was. Often it is time to replace the item by the payments are done.  It is not unusual for what you owe to be more than what the item is worth.

Cars are a good example of this. If you buy a new car, and finance the entire purchase, it is likely that as soon as you drive off the lot, you will owe more on the car than it is worth. They depreciate that quickly. By the time you are done with the payments, you will want a new car.  So the cycle begins again. 

Another example is buying a house. If you purchase a house at the peak of the market and finance a large portion of the purchase price, if housing prices go down, you can run into the situation where you owe more than your house is worth. If you have to move for some reason, you could find yourself in a situation where you have to pay money to sell your house.

Many people think that they are getting a benefit from financing their purchases. After all, they get to have and start using them right away.  But is it really worth it?  By waiting until you have the money to pay for it, you save thousands of dollars in interest every year.  Want to buy more things?  Quit financing them.

Who really benefits from debt?  The one making the loan benefits.  Sure, they are taking the risk that you won’t pay them back, but most people do pay them back.  Otherwise they would not continue making loans.

If you are borrowing money to purchase something, you are in effect in raising the price.

Who benefits?  The seller and the finance company do.   The seller gets their money and the finance company makes money on the amount you borrow.

If you borrow money on a car or a house, who owns it?

The finance company does until you pay off the note. Miss the last payment and they have the RIGHT to repossess it. You gave away that right to them when you borrowed the money. You will have paid more for the item than it is worth.  They still have the right to repossess it.

It is clear that the borrower is not the one who benefits, but the lender. 

But the good news is that you don’t have to continue to be in debt.  You can change your attitude toward it and change your habits.  Then you will be in control of your money and your things.  No more being upside down on the loan, you won’t have a loan to be upside down on any more!

Each week I will be covering debt relief topics. I look forward to sharing with you every week!

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God Bless your week!