True Credit Repair | The Most Powerful Solution For Credit Repair

Do you ever feel overwhelmed by the debt you’re facing? Like you’re barely staying afloat with the credit card, student loan, mortgage or other payments you’re making? Maybe you feel like your mounting pile of debt is so large that you’ll never pay it off? Today’s the day things start to change for you.

Do you ever feel overwhelmed by the debt you’re facing?

Like you’re barely staying afloat with the credit card, student loan, mortgage or other payments you’re making?

Maybe you feel like your mounting pile of debt is so large that you’ll never pay it off?

Today’s the day things start to change for you.

Take a deep breath, sit up straight, and let’s formulate a game plan so that you know how to get out of bad debt as fast as possible — and so that you can turn your personal finances around.

You can overcome any amount of debt.

It just takes the right plan of attack, a little gumption, and most importantly, a radically different approach to debt than you learned in school or from your parents.

What are the Disadvantages of Having a Bad Credit Score

 

How To Get Out of Debt?

Debt exists in many shapes and sizes:

  • Credit card debt

  • A mortgage

  • An auto loan
  • A student loan
  • A loan from a bank
  • Money drawn on a home equity line
  • A loan from a life insurance policy
  • A medical bill
  • A legal bill
  • Any money you owe to someone else (usually with interest)

If you have one or more of the above, you’re certainly not alone.

The fact is, 8 in 10 Americans have debt. 

What’s more, the typical American household has an average debt of $137,063.

 

Depending on whether you fall above or below

that $137,063 mark, hearing this number may make you feel better — or horribly worse (sorry!) — about your own debt situation.

Here’s the good news: you can overcome any amount of debt.

Let’s look at how to get out of bad debt.

 

Rethinking Debt: Bad Debt vs Good Debt

If you’re like most people, you’ve been conditioned by well-intentioned parents, teachers, mainstream media, and maybe a “financial expert,” to see debt as your mortal enemy. 

“Debt-free is the way to be!” they say. Which has a nice ring to it, but in reality, not all debt is created equal.

There’s certainly bad debt. And you need to know how to get out of bad debt. 

But there’s also good debt. And most debt can be good or bad, depending on how you use it.

 

Bad Debt

Bad debt is the breed of debt that’s been keeping you up at night, and it’s what most people think of when they think of debt.

Bad debt is simply money you’ve borrowed to buy something that doesn’t put money right back into your pocket.

When you use money that isn’t yours (e.g. a credit card) to buy something you couldn’t otherwise afford like:

  • That purse you’ve had your eye on

  • Tickets to the football game
  • That top-of-the-line massage chair

Or anything that isn’t going to increase in value or produce cash flow for you.

That’s bad debt.

Spend $300 on a night out that you can’t afford, put it on your credit card, make minimum payments until it’s paid off, and your actual cost for that night – including interest – will end up being around $430.

Yikes. Hope you had a blast with your friends.

Again, if you have loads of bad debt, fear not! 

In just a minute, we’ll cover a fail proof strategy that will help you learn how to get out of bad debt — as quickly as possible. 

But first, it’s important you understand the good kind of debt.

 

Good Debt

Good debt is money you’ve borrowed to make an investment in a cash-producing asset.

Good debt is “good” because what you’re using it for makes you more money than the debt costs you.

Here’s an example:

Your friend Megan loans you $100,000 to buy a house.

You rent out the house to a nice little family called The Smalls.

Each month, you collect $1000 in rent from The Smalls and you give Megan a $440 payment on the loan.

What’s your profit per month?

$1000 Collected in rent from the Smalls
– $440 Loan payment to Megan

_________________

= $560 Profit

You used Megan’s money to make you an extra $560 a month. The loan from Megan is good debt.

Keep making loan payments until the loan is paid off, you’ll own the house free and clear, and now the entire $1000 in rent from the Smalls is yours to keep. Every single month. For the rest of your life.

Let that sink in.

Go back and read it again if you need to.

You used debt to buy an asset (a house) that generates cash flow in the short-term and builds wealth in the long-term.

It sounds like an overly simple example (and it is), but it illustrates a principle that successful real estate investors use all the time. They use good debt – in the form of other people’s money (banks, private lenders, hard money lenders, etc) – to build wealth for themselves.

And you can too!

Down below, we’ll look at a couple other examples of good debt, and how to leverage good debt to help you pay off bad debt and start building wealth for yourself and your family.

But first, let’s review.

 

Distinguishing Good and Bad Debt

Now you know, debt can be good or bad, depending on how you use it. Let’s dig in a bit more. This can be counterintuitive.

Here’s an example:

For the past few years, you’ve been saving money. Not for any specific reason, but just because you know it’s the smart thing to do.

You decide today’s the day you open up your savings account and inside you find a whole $40,000.

You could really use a new car, so you take the $40,000 you’ve saved and head down to the dealership where you find a nice vehicle for sale.

After a bit of negotiating, you talk the salesperson into selling you the car for $40,000.

“How will you be paying for the car today?” She asks.

You have two options:

Option 1: You can pay $40,000 cash and use all of your savings.

Option 2: You can put $3,000 cash down, then pay $675 a month for the next 5 years.

If you take Option 1, the car is yours today, debt-free.

If you take Option 2, you’re in debt for the next 5 years, and you end up paying a total of $43,500 ($3,000 down payment + $675 a month x 60 months = $43,500).

So the question is: why would you ever go into debt when you can easily afford to pay cash for the car?

The answer is: because even a car loan can be good debt.

If you think about it, by only paying $3,000 cash up-front, you’re keeping $37,000 cash in your pocket, and you can do a lot of good things with that $37,000.

Say you take that extra $37,000 and invest it into your friend Max’s business. Max immediately uses the money to grow his business, and he starts paying you $920 a month return on your investment.

So each month:

  • You get your $920 from Max

  • You pay $675 toward your car loan

  • You profit $245

Within 5 years, the car loan is entirely paid off, you’ve been profiting $245 a month the entire way. Now that the car loan is out of the way, the entire $920 a month is yours to keep.

Again, let this example sink in.

Even though you could have paid cash for the car, you went into debt instead and you turned it into good debt by investing it in an asset (Max’s business).

Now, had you taken out the car loan then blown the $37,000 on a little boat and a little jet ski to go with your little car, you would have accomplished just the opposite. You would have created bad debt.

But you didn’t!

And herein lies a secret of the wealthy. 

Ready for more?

Disadvantages of a Poor Credit Score

 

Debt Secrets of the Wealthy

Most people work, they earn income, and then they use that income to pay their expenses (little cars, little boats, little jet skis, and everyday living expenses).

That’s just how most people go about life. Work to make money, and use that money to pay expenses and maybe take a vacation now and then.

But that’s not how wealth-minded people think.

Wealth-minded people use their income to buy assets, such as:

  • Businesses

  • Real Estate
  • Stocks
  • Education

Then, in the short run, the cash flow from those assets is what pays their expenses. 

And in the long run, those assets build real value and wealth.

That’s just one of many ways wealthy people think differently than everyone else.

It’s how they got wealthy, after all. They didn’t just do what everyone else was doing. They didn’t follow traditional financial advice.

Had they followed the traditional path, they would have ended up where people traditionally end up: living paycheck to paycheck, stressed out, feeling like they’re never getting ahead, and hoping and praying they’ll be able to retire one day.

But they didn’t. They thought differently, they acted differently, and they ended up wealthy because of it.

So if you have aspirations of becoming wealthy one day

it’s important you start thinking how wealthy people think. It’s important you know the difference between bad debt, good debt. Then you can start using good debt to your advantage!

In doing so, you thought like wealthy people think. And you invested like wealthy people invest. Good job!

You see, wealthy people view debt differently in general.

Wealthy people actually love debt. 

Bring on the debt! The good kind, that is, because here’s the truth about your debt:

  • The higher you can raise your credit card limit

  • The larger you can extend a home equity line of credit (HELOC)
  • The more you can sock away into a permanent life insurance policy that you can borrow from later
  • The more private lenders you can create relationships with
  • The more you can maximize the debt you have available to you

The greater your ability to take advantage of great investment opportunities that come your way.

Like wealthy people, you should be acquiring as much debt capacity as your credit allows. Don’t wait until you need money to try to acquire it. Do it now.

  • Increase your credit card limits

  • Open up a HELOC
  • Create a permanent life insurance policy and start saving in it

Do it all now before you need the money. That way, when you do need it, you have that debt at the ready and you can use it for good.

Make sense?

 

Now you may be sitting there thinking . . .

“This is all well and good. I get the good debt / bad debt thing. But seriously, I’m up to my eyeballs in bad debt right now. Help me get out of it, like, today.”

 

How To Get Out of Bad Debt So You Can Start Racking Up Good Debt

There are lots of popular debt payoff strategies out there (with weather-related names for some strange reason) that help you know how to get out of bad debt, such as:

  • Debt Snowball

  • Debt Avalanche
  • Debt Tsunami
  • and more

It’s as if the financial gurus are locked in a battle of meteorological one-upmanship.

Each of these strategies is a little different. 

All of them can be effective. But none of them are perfect.

 

 

Every minute you spend dwelling on how much your debt sucks

is a minute you’re NOT spending on strategically fighting your way out of it. All you need is 10 minutes a month. Be conscious of your debt, but don’t dwell on it.

When wealthy people find themselves in a tight financial situation – like you may be in right now – they don’t focus on strategizing within it. They focus on growing out of it.

They’re not focused inside the box. They’re focused on thinking, strategizing, and making moves outside the box.

Heck, they’re focused on shattering the damn box!

Start making more money so you put bad debt in the past for good.

You can do it, my friend. Immediately.