Debt

[Stefanie 1]

Well, we have a car to pay off and two credit cards. We are paying way more than the minimum payment for the CCs every month... so we should be done with one pretty soon. The car payment is still going on for another five years (we just bought it) unless my husband will get a bonus for reenlisting in the military. Then it'll get paid off earlier.

Of course we have debt but we are never struggling doing our payments. If we need to cut down on some of those luxuries, I would get rid of our second car which would save us quite a chunk because of insurance. I would lower the cell phone plan, get rid of cable (and get a netflix movie pass for 9.99 instead), cut down on going out to eat (not living in the US and going to Starbucks or fast food places every other day is saving is tons of money right now), only get a basic house phone line (and just hang up when telemarketers call), drink water and no soda (cheaper AND healthier)...

Stef

[addy 0]

I just got an email from the credit counselor who saw my report. They want me to schedule an appointment to see them. I also filled out a credit card application that has 0 apr so hopefully I can transfer that huge debt to it and get rid of the cards with the highest debt. I'm keeping the third card that says I have 0 apr.

I took your advice and told my boyfriend the truth. He wasn't mad. Just concerned about how I managed to have the cards that high. I explained how it all happened and he was so sweet. You don't know how I felt when he helped me make a gameplan to make my debt go away. I love him very much. Now I am more determined than ever to get a job.

[TracyTN 237]

Great news, Addy. I knew Dan would be supportive.

[ChristinaM 0]

Hey, nice job! Being proactive about your debt is the only way to get it sensible - and you can, it may just take a while. (Trust me on the taking a while thing, ok!)

[bostonparis 0]

I just got an email from the credit counselor who saw my report. They want me to schedule an appointment to see them. I also filled out a credit card application that has 0 apr so hopefully I can transfer that huge debt to it and get rid of the cards with the highest debt. I'm keeping the third card that says I have 0 apr.

I took your advice and told my boyfriend the truth. He wasn't mad. Just concerned about how I managed to have the cards that high. I explained how it all happened and he was so sweet. You don't know how I felt when he helped me make a gameplan to make my debt go away. I love him very much. Now I am more determined than ever to get a job.

Good for you for telling him. That probably took a huge load off your shoulders - not only due to the stress of keeping it from him, but you have someone to share your burden with.

[Cassie 8]

:thumbs: :thumbs:

I have a 0% interest rate (!) on one of my credit cards, and 3% on the other.

Trust me, they'd rather get their money and not make anything off of it than never get it at all.

Cass (bebop the great)

Absolutely.. Instead of ruining your credit score by continuously opening new credfit accounts. Call all of your creditors and negotiate with them to lower your interest rate... Most people don't realize this, but you don't have to take the interest rate that they give you, everything is negotiable.

Not always the case. We now have three CC's paid off (with two different companies). This past weekend we called them up to see which company would give us the best rate--the best one we would keep, and the other two we would cancel. One company gave us 7.9% fixed rate -- the other one couldn't give us anything better than 16%, even after we told them what the other company would give us. Their loss! They tried to entice us with the 0% interest rate, but when we heard that the 0% was only going to last for 6 months, no thanks. CC's are tricky with the 0% thing, you really have to read the fine print on that.

I worked in collections for a credit card company, and their rule for even thinking about reducing credit card rates was the cardholder had to have made at least payments on time for at least 6 months' straight, and even then they wouldn't reduce the rate all that much. And trust me, they are out to make money! It was a job that absolutely sucked the life out of me, I was glad to leave it.

PS: Addy, good job on talking to your honey about all of this, and best wishes as you make a plan to work through all of this.

Edited January 20, 2007 by Cassie

[Henia 11]

4 choices

dont pay the debt

struggle and pay the min

go to credit counseling

go bankrupt

[zyggy 9]

:thumbs: :thumbs:

I have a 0% interest rate (!) on one of my credit cards, and 3% on the other.

Trust me, they'd rather get their money and not make anything off of it than never get it at all.

Cass (bebop the great)

Absolutely.. Instead of ruining your credit score by continuously opening new credfit accounts. Call all of your creditors and negotiate with them to lower your interest rate... Most people don't realize this, but you don't have to take the interest rate that they give you, everything is negotiable.

Not always the case. We now have three CC's paid off (with two different companies). This past weekend we called them up to see which company would give us the best rate--the best one we would keep, and the other two we would cancel. One company gave us 7.9% fixed rate -- the other one couldn't give us anything better than 16%, even after we told them what the other company would give us. Their loss! They tried to entice us with the 0% interest rate, but when we heard that the 0% was only going to last for 6 months, no thanks. CC's are tricky with the 0% thing, you really have to read the fine print on that.

I worked in collections for a credit card company, and their rule for even thinking about reducing credit card rates was the cardholder had to have made at least payments on time for at least 6 months' straight, and even then they wouldn't reduce the rate all that much. And trust me, they are out to make money! It was a job that absolutely sucked the life out of me, I was glad to leave it.

PS: Addy, good job on talking to your honey about all of this, and best wishes as you make a plan to work through all of this.

It does depend on how good a client you are to them and your potential to become a good client... But I do disagree about them not lowering it... Did you speak with someone higher up the chain... I had to go to 4 different people before I got someone who had the authority to lower the interest... They just want you to give up or talk you out of it before you actually get to the person who can do something... I never said that they make it easy... But they will make a judgement on whether they want to keep you or not before they will lower the rate... If they think you're worth keeping, they will lower it if your persistent about it..

And they will lower it more than a little bit.. I got mine lowered 7%.... Not chump change...

[Augustajim 0]

Well I must be the low-life. I got laid off from a 70k a year job with a huge house payment and a 40k truck and a car payment, then my wife bailed, I had to go the bankruptcy route. It cleared it all and set me back up to not make many of the same mistakes again. That was a few years ago. I have a whole new outlook on credit and job security. Getting re-called was a big help too

Jim

[doodlebug 3]

Getting a divorce definitely stopped the bleeding for me!

[SteveLaura 0]

Start with a budget. Take at least one month's worth of bills and see where your cash is going. Make adjustments accordingly (quit the cable, cell phone/landline, high-speed internet, lunches out, etc). Stick to the budget.

Pay minimum on all debts. Take any cash left over and start an emergency fund. (If there's no left over cash, do your budget again. Be brutal.) Amass at least 3mths income.

Once the emergency fund is in place, use the monthly amount you were paying into it to pay off the debt with the highest interest. (Alternatively you could pay off the smallest debt - if it's very small - just for the psychological factor.) Continue each month 'til debt is paid.

Snowball the money you were paying into Debt 1 and pay off Debt 2 - the 2nd highest interest rate. Continue this system 'til all debts are paid.

Keep an eye on the budget - adjust it if necessary, preferably downwards.

Cook more food than you need and have the left-overs for lunch.

Give yourself little rewards when another debt is paid.

Focus on the bigger picture. We're doing this at the moment as we want to buy a house next year. We're on schedule for the summer, to be debt-free (1 credit card down, 1 to go, and 2 car loans to pay off) and have a reasonable down-payment.

Can't take credit for this advice - we got this from our free independent financial adviser last year.

Good Luck.

[bebop + rocksteady 0]

See, I was the opposite of what you guys said. A bad customer. I was sick and out of work for a year in college, missed all my payments on two cards for about 6 months. I called them, explained I couldn't make the payments, they quickly offered to lower my interest rate to 0% and 3% on the two cards, and asked me what I could afford to pay, and set that as the minimum payment until I called and told them otherwise.

If they wouldnt' have done that, I probably would have had to file for bankruptcy. But now, (3 years later) I'm finally starting to make a dent in it thatnks to the low interest and being out of college.

Cass (bebop the great)

:thumbs: :thumbs:

I have a 0% interest rate (!) on one of my credit cards, and 3% on the other.

Trust me, they'd rather get their money and not make anything off of it than never get it at all.

Cass (bebop the great)

Absolutely.. Instead of ruining your credit score by continuously opening new credfit accounts. Call all of your creditors and negotiate with them to lower your interest rate... Most people don't realize this, but you don't have to take the interest rate that they give you, everything is negotiable.

Not always the case. We now have three CC's paid off (with two different companies). This past weekend we called them up to see which company would give us the best rate--the best one we would keep, and the other two we would cancel. One company gave us 7.9% fixed rate -- the other one couldn't give us anything better than 16%, even after we told them what the other company would give us. Their loss! They tried to entice us with the 0% interest rate, but when we heard that the 0% was only going to last for 6 months, no thanks. CC's are tricky with the 0% thing, you really have to read the fine print on that.

I worked in collections for a credit card company, and their rule for even thinking about reducing credit card rates was the cardholder had to have made at least payments on time for at least 6 months' straight, and even then they wouldn't reduce the rate all that much. And trust me, they are out to make money! It was a job that absolutely sucked the life out of me, I was glad to leave it.

PS: Addy, good job on talking to your honey about all of this, and best wishes as you make a plan to work through all of this.

It does depend on how good a client you are to them and your potential to become a good client... But I do disagree about them not lowering it... Did you speak with someone higher up the chain... I had to go to 4 different people before I got someone who had the authority to lower the interest... They just want you to give up or talk you out of it before you actually get to the person who can do something... I never said that they make it easy... But they will make a judgement on whether they want to keep you or not before they will lower the rate... If they think you're worth keeping, they will lower it if your persistent about it..

And they will lower it more than a little bit.. I got mine lowered 7%.... Not chump change...