Before discussing whether to pay off a credit card or mortgage first, we must know that the settlement of bad credit can be achieved by being active in approaching the lender and the activity of the recipient of the credit to pay off the credit.
From the Credit Provider
From the credit provider, usually a bank or lending institution, settlement of bad credit can be reached by doing credit rescue. Rescue of credit can be done in several ways, including:
Rescheduling is a change in credit requirements that only concerns the payment schedule and credit period. Loans that obtain rescheduling facilities are only debtors who meet certain requirements, among others, the business of the debtor has the prospect of bouncing back and the debtor shows good faith
In the process of rescheduling, principal and interest arrears are summed (capitalized) and then rescheduled payments are made to create a separate rescheduling agreement
Return requirements ( reconditioning )
Return requirements are changes in part or all of the credit terms that are not limited to changes in the payment schedule, time period and other requirements insofar as it does not involve changes in the maximum credit balance.
In this reconditioning it can also be given to relief debtors in the form of partial interest arrears or termination of interest calculation for debtors who are honest, open and cooperative and their business can still potentially operate profitably but experience financial difficulties.
Changes in credit terms relating to the addition of bank funds, conversion of all or part of arrears of interest into the principal of a new loan or conversion of all or part of the credit to participation in the company, which can be acquired and with rescheduling or re-requirements.
In finance that Sam Weller once shared, there are two strategies known to pay off debt. Both of these strategies can help you prioritize which debt is better to pay off first.