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How to Get Debt Relief in California

Sarah Edwards | October 19, 2022

Sarah Edwards
Legal Expert
Sarah Edwards, BS

Sarah Edwards is a professional researcher and writer specializing in legal content. An Emerson College alumna, she holds a Bachelor of Science in Communication from the prestigious Boston institution.

Edited by Hannah Locklear

Hannah Locklear
Editor at SoloSuit
Hannah Locklear, BA

Hannah Locklear is SoloSuit’s Marketing and Impact Manager. With an educational background in Linguistics, Spanish, and International Development from Brigham Young University, Hannah has also worked as a legal support specialist for several years.

You can find the debt relief you need.

Summary: If you're struggling with debt in California, SoloSuit can help you find the relief you need.

If you're in debt, you probably understand the feeling of struggling to meet your bills. It can be a constant battle, especially with the rising cost of living and high taxes. People in California also must deal with high rental costs, which can be significant across the state.

This mixture results in a constant hamster wheel of earning income, paying for basic needs, and trying to pay down debt. It can be very hard to get off the hamster wheel once you're on it.

The idea of living in California is attractive to many. Known for its gorgeous shoreline, beautiful cities, and movie stars, it appeals to people from all over the world. However, behind its ability to captivate lie some of the highest living expenses in the nation.

The average individual living in California carries $3,852 in credit card debt. A recent study performed by the University of California, Berkeley, indicated that in certain areas, renters spend up to 45% of their income just to maintain a roof over their heads.

Californians faced with these types of expenses may find them difficult to overcome. So how do you get out of debt in the Golden State? Here's SoloSuit's guide to finding debt relief in California.

Let's jump right in.

Ready to find your financial footing again?

To get an accurate picture of your debt, you'll need to assess how much money you earn and what you spend it on each month. Start with your monthly income, and then list out your regular expenses.

These should consist of your rent or mortgage payment, food costs, transportation, and payments towards debt. Any other regular expenses you have should be included.

Next, figure out how much of your income is going towards things you can potentially do without or cut down. These things may include eating out or other entertainment expenses, such as going to the movies. You'll use all of this information to create a monthly budget.

Before creating your budget, make sure you understand what your goals are. If you're seeking to get rid of credit card debt, determine which cards you plan on paying off and understand what you owe on each of them.

Your budget should allow you to meet your necessary expenses while also cutting down on discretionary ones. This approach gives you the opportunity to put more towards getting rid of credit card debt. You should keep a small buffer to guard against unexpected expenses which pop up from time to time.

Take advantage of California assistance programs

There are a variety of assistance plans that California residents can take advantage of. The state provides programs that offer financial assistance for medical expenses, navigating negotiations with debt collectors, and other kinds of financial concerns. For example, the state hosts a resource center to inform residents about their rights when dealing with debt collectors.

There are also grant programs available and federal funding for basic needs like rent, medical expenses, and food for those who qualify. Consider exploring the Healthy Families program, Homeowner Assistance program, and other resources available to California residents.

These programs can help you to get back on your feet, especially when you're facing extreme debt.

Set up a schedule for paying off debt

Establishing a schedule for paying off debt can help you stay on track and measure your efforts. One common method recommended by financial advisors is the snowball method.

Under the snowball method, you list all of the debt that you owe. Next, you set the amount of money that you have available each month to pay towards your expenses.

You make the minimum payments on all of your debts each month but put all of the remaining balance towards the smallest debt you owe. As an example, assume that you have a medical debt of $5,000 and a single credit card with a balance of $1,500.

The minimum payment that you owe monthly on each of these is $100. You have $400 each month that you can afford to pay toward your bills.

Thus, you'll make a payment of $100 towards the medical debt each month and $300 towards the credit card balance. You'll follow this method each month until the credit card is paid off. Afterward, the entire $400 will go towards the medical bill each month. In under two years, you'll be completely debt-free!

When should I consider debt consolidation?

Another option for debt repayment is the use of debt consolidation. This choice is best for those who have a decent credit score and are able to obtain a large enough loan to pay off other debts.

Usually, debt consolidation loans come with a low interest rate for a certain period. This rate can benefit those who have high-interest obligations and provide the means to pay off debt quickly.

For example, someone with $5,000 of credit card debt with an average APR of 10.9% could obtain a debt consolidation loan for the entire $5,000, with an interest rate of 0% for six months.

If they use the loan to repay their credit cards and then pay off the entire $5,000 for the debt consolidation loan within six months, they'll have potentially saved hundreds of dollars in interest expenses.

When is debt settlement an option?

Another consideration for those seeking to get out of debt is using a debt settlement program. While you can seek to obtain debt settlements yourself through negotiation techniques, not everyone may have the skills (or time) required to do so. Thus, many seek debt relief programs that handle the negotiation for them.

Understand that there are many debt settlement companies that may not be legit. So before deciding to enter a debt settlement program, do your research. The company should be rated well and have solid reviews. You shouldn't have to pay anything upfront for their services.

Debt settlement involves negotiating with lenders to settle amounts owed for a fraction of the cost. When they are negotiating for you, you'll make predetermined payments to the company that they'll hold until enough is available to settle and pay their fees.

Typically, these programs last between two and three years but result in your debt being paid off. Debt settlement programs charge a percentage of the value of your debt for their services.

You might also consider negotiating a debt settlement offer on your own. This will help you avoid the fees, and sometimes it can be a faster process overall. Check out SoloSuit's guide on reaching an ideal settlement for you in this video:

What is SoloSuit?

SoloSuit makes it easy to respond to a debt collection lawsuit.

How it works: SoloSuit is a step-by-step web-app that asks you all the necessary questions to complete your answer. Upon completion, you can either print the completed forms and mail in the hard copies to the courts or you can pay SoloSuit to file it for you and to have an attorney review the document.

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"First time getting sued by a debt collector and I was searching all over YouTube and ran across SoloSuit, so I decided to buy their services with their attorney reviewed documentation which cost extra but it was well worth it! SoloSuit sent the documentation to the parties and to the court which saved me time from having to go to court and in a few weeks the case got dismissed!" – James

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>>Read the FastCompany article: Debt Lawsuits Are Complicated: This Website Makes Them Simpler To Navigate

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