CC Debt | Imamother

amother ↓

Thu, Aug 18 2011, 10:08 pm

I have $4000 on cc debt and I need a good way to get rid of it.

I don't want to borrow money from a friend.... and I've been paying it off for a while now...

Should I speak with the credit card company/ bank or something to that sort?? (and what do I say??)

Any advice or experience?

TSMIA (Thank so much in advance Very Happy

)

ganizzy

Thu, Aug 18 2011, 11:02 pm

If u have good credit then u can get a cc with no interest for a yr and do a balance transfer. then at least ur not paying all that interest.

Most cc will make a deal but usually its if ur account has been overdue for a while. if they do make a deal with u, make sure to get it in writing and that they'll accept the amount as balance paid in full

doitall

Thu, Aug 18 2011, 11:47 pm

I'm in the same situation and would love to hear advice (other than paying it off as fast as we can)! I looked into getting a new credit card with no interest for a year but the balance transfer fee was a lot of money. Does anyone know of cards with lower transfer fees?

↑ amother ↓

Fri, Aug 19 2011, 12:19 am

amother wrote:

)

I have advice for you but only if you are willing to default on your payments (which will affect your credit score). Basically, dh and I were in a LOT of debt over a year ago, wayyy more then $4000, but we had always been paying every bill on time and the full amount. So my husband called the credit card company to try to get his payments lowered and they were willing to work with him a teeny bit but nothing that really helped us out much because until that point, we were good loyal customers who were able to pay our bills. Then we decided to file bankruptcy (not recommending this to you necessarily, just a step we had to take) and our lawyer told us to stop paying our credit card bills until the bankruptcy was official. Suddenly the credit card companies were calling us and begging us to pay something, anything, they were suddenly willing to work with us and lower the interest rates and payments by a huge amount because they realized that we are struggling to pay the bills so they were willing to work with us just to get something out of us. But we just kept telling them that we are going to be filing bankruptcy soon and our debt will be wiped away which b"h happened. The point is that once you start majorly defaulting on your payments, the credit card companies WILL work with you cuz they'd rather get something then nothing. But the downside is that this will affect your credit score so you have to weigh the pros and cons of it....

suzyq

Fri, Aug 19 2011, 9:46 am

Call and ask the credit card company to lower your rates. Tell them you are thinking about switching if they don't. Right now, interest rates are very low and you may well be able to find a lower rate card. Good luck.

ElTam ↓

Fri, Aug 19 2011, 10:04 am

I would not default or go into bankruptcy unless there is literally no other option. A bankruptcy doesn't just affect your credit score, it makes it virtually impossible to get credit for the next seven years. If you do get credit, the rates you pay will be through the roof. What if you need to get a new car in that time? You also miss out on things like credit cards from stores where you can pay 18 months same as cash (like from Home Depot if you need a new appliance, etc.).

Take a very hard look at your budget and see where you can cut things out.
Do you eat out or get take out? Cook in and put the money you were spending on restaurants toward the credit card. This makes an even bigger impact if you are buying lunch out at work.
Plan ahead. If you regularly stop and buy a soda at a vending machine or convenience store or coffee, you can buy ahead of time and take it with you. That really adds up.
What is the deductible on your renters/homeowners/car insurance? If it is $250, up it to $500 and put the premium savings into your credit card bill.
How often a week do you eat meat? For my family, cutting out one meat meal a week could save me $10 a week, $40 a month, or $480 a year. That's a big chunk of debt gone in a hurry.
Do you have extra stuff you can sell on craigslist? Any money made goes straight to the bill.
Lots of other ideas, but some may not apply given your situation, e.g., do you own a home or rent, etc.

I agree with opening another no-fee credit card and then calling your first card and saying that you are thinking of closing the account, can they lower the interest rate. On the balance transfer cards, I have never gotten an offer that required a balance transfer fee. So look around. BUT, make sure you can pay off the full amount you transferred in the time set, because after that, the rates skyrocket.

I also highly recommend the book "The Complete Tightwad Gazette." Really great ideas for saving money and changing the way you look at money.

↑ amother ↓

Fri, Aug 19 2011, 12:23 pm

Can you do a balance transfer if the original cc is already in collections? (That agreement is being paid monthly but they didn't lower the interest rate, which is [crazy])

↑ ElTam

Fri, Aug 19 2011, 12:37 pm

No, if it is in collections, they won't transfer it out as far as I know. So your best bet is to see where you can cut your budget, grocery, clothing, and other expenses and put that money to the credit card.

Dolly Welsh

Fri, Aug 19 2011, 3:38 pm

You might consider a debt consolidation loan. This might be possible even if you are already in collections.

Only use a reputable big-name commercial bank, preferably one you already use, so they know you. Walk in with every single bill, and proof of your income, and they will help you apply for a loan, possibly with auto-deduct payments, the whole amount you owe everybody. It's smart to go to the bank about 9 or 10 am, for best service.

They will also cancel and cut up all your cards and credit lines.

This will give you one defined burden you can see, and will get it under control. The loan's interest will also probably be a lower rate than the cards' rates.

You might have one card left, just for convenience when buying gas, say, with a small line, perhaps a secured card.

Never, ever use a non-standard, small operator source for a loan. Only a big, famous-name bank.

Before you take any loan, know what the true interest rate is. The cheap-sounding loans or low-qualification loans can be more expensive, in reality. Those don't like to describe interest rates, just low monthly payments, but that's baloney and hides the true cost over time.

Lakewood

Fri, Aug 19 2011, 3:57 pm

It's $4,000. I agree with Eltam - cut in every possible place. You will have faster then you would expect.

↑ amother

Fri, Aug 19 2011, 6:56 pm

ElTam wrote:

I'm the amother who said we filed for bankruptcy. I just want to correct you because what you said is not true anymore. It used to be that people who filed for bankruptcy could not get credit for seven years or buy a new car etc... but unfortunately with the economy being so bad and soo many people filing for bankruptcy, its becoming more commonplace and it is totally possible to get credit cards, loans and credit soon after filing for bankruptcy. Of course it leaves a big mark on your credit, and you may pay somewhat higher interest rates but its not as bad as you are saying. Also credit card companies jump to offfer a credit card to someone who just filed bankruptcy because they know you can't file again for another 8 years (by law) so you are perfect candidate for them. We were able to lease a car less then a year after filing for bankruptcy... just wanted to point that out...

lamplighter

Sat, Aug 20 2011, 9:18 pm

I think $4000 is manageable. Don't ruin your credit, try and cut corners and increase your revenue.