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To: Disambiguator

No doubt that paying off debt is a good thing - debt is a running liability that mounts with each interest period.

What is "snowballing"?


70 posted on 02/01/2006 10:32:31 AM PST by thoughtomator
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To: thoughtomator
What is "snowballing"?

Snowballing debt is a way to accelerate the paying down of debt over time.

If your monthly debt service equals $1500, for example, you would always pay $1500 towards debt.

As you pay off certain notes, the amount paid toward that note would be rolled into the payment of another note until it was paid off, and so on.

Pretty soon you are paying $1500 towards one note (which you might have previously only been paying $500 against), and that last debt will be eliminated that much more quickly.

All of this assumes, of course, that you are not accruing any additonal debt during the process.

147 posted on 02/01/2006 12:27:24 PM PST by Disambiguator (Making accusations of racism is the last refuge of a scoundrel.)
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