Debt had been piling up for the Simpsons. The level of debt Blair & Susan accumulated on their credit cards and credit lines became a big overwhelming stress in their life. It seemed like such a large amount and they couldn’t see a clear way out.
Some strategies they started with:
They called their credit companies to reduce their interest rates. This helped ease payments a little. They also moved some money to an unsecured line of credit for lower rates. This also helped a little bit but the Simpsons were still having a hard time getting ahead.
Income: Blair & Susan worked full time but once they added all the bills up, they were in a cash deficit each month. This shortage got them further and further in debt.
Credit: An issue that arose was some missed payments on their credit bureau leaving them with some bruises on their credit bureau. This limited their options of lenders to provide them financing.
Real estate: They had owned their home for 5 years and the value had gone up. This increased home value was available to help provide a solution.
Solution: The Simpsons received a mortgage using the increased equity of their home. The financing they received cleared their credit card balances and more importantly helped them get their monthly budget in alignment so that they had more cash available relieving a huge stress. With the cash flow available at the end of each month they were able to pay debt down and put funds aside into a savings account to avoid getting back into the debt cycle.