I cannot refi my house because of a Prepayment penalty. I spoke to my local bank about trying to get a personal loan but it will be at a 20% interest rate at a 0 a month payment for the next 5 years which is really too high to fit in my budget right now. I am thinking about Credit Counseling but I know it totally ruins your credit so I was trying to avoid but it looks like this might be my only option. Anyone ever been through one of these programs? Was it helpful? Any other suggestions?
I have 15,000 in credit card debt and really need to do something to get out. Any suggestions?
July 30th, 2010 
admin 
Posted in Credit Card Debt Counseling 
Don’t borrow to pay off a debt. The first thing is quit charging.
pay cash and take a second job and put all of it on your debts and cancel them one at a time. But if you borrow and pay then you will just keep it up until you file bank ruptcy and ruin your credit.
you can try credit counseling it may help. when i was in that situation i kept transferring my high interest cards to new cards with 0%apr for the first year.
It only ruins your credit for 5 years then you get a clean slate. It will give you a chance to pay more off your house!
Ask the bank to extend your credit card loan over a longer period to reduce monthly payments
You will just have to pay the prepayment penalty.
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Refis ad other loans are just more LOAN ,
You need to PAY the CC , not get more loan.
Serious people who ‘get it’ , get a 2nd job and put everything towards paying off that debt.
As far as credit counseling , with $15K in debt , your credit is already bad (unless your income is in the ($100K+ range with no kids) . Your BAD credit is why the bank loan is 20% , they know, they saw your credit report , you are way over your ability to repay so they want 20%.
The best way to salvage your credit is to get that extra income and start putting at least $1K a month towards it.
Many people who get the counseling , improve their situation for awhile , then go right back to over spending because they NEVER really get it .
Do you actually understand where you have gotten yourself with the CC ? or not really , you are just tired of seeing the bills ?
A debt management plan would pull down an excellent credit score, but your score is likely below 650 based on the rate your bank offered. I don’t believe there would be a negative impact in your situation. Either way, a qualified credit counselor would be able to review your credit report with you to determine the impact of such a plan.
Choosing the right credit counselor will make all the difference though. Some of the larger agencies may try to sell you on a plan without spending the time to make sure your needs are truly met. I recommend finding an agency that you can personally visit that has a good reputation and satisfactory rating with the Better Business Bureau.
You may need to consolidate your debts with a company that gives loans to people with bad credit. Check out http://mortgage.yeyeyup.com. Click on the "debt consolidation" link.Then apply. They may provide you with professional advice regarding all options that are available for free.
Bankruptcy stays on your record for 10years, but doesn’t keep from living and borrowing short term. It is more difficult to file now with the new laws. What you really need, is to learn and practice new spending habits. Without a change in life style, you keep going in the credit card circle. Credit counseling is a very tricky route as the industry is full of crooks who don’t fix any thing and keep your money.
Some credit card companies will work with you if you call them directly and discuss your problem. Show them you have a plan and follow it. Refi with penalties may be the best depending on if you can handle the payment. You can always refi again a few years when your credit improves as you work out of the debt.
I can’t stress enough, that you YOU need to change and break the spending habbit. Buy what you need and not what you want and be strong enough to know the difference. I have seen people use this to start over after $75000 in credit card debt in less than five years. Be realistic with your goals and income.
Good Luck.
PS Watch out for loan scam artists, If you need to send money to a foreign country or give out personal info with out checking source SCAM ALERT.
my mom was alot deeper than that, and she consalitated and now she is really saving money, it used the be the interest that killed her.
Since most companies bill you for 2% of the balance or $20 whichever is greater, I’m assuming your payment is around $300 per month with an average interest rate of 8%.
The easiest method I can think of is to set a firm payment. In other words, if your payment is $300 this month, keep paying that. Even if you pay down and have only a $250 payment…continue to pay the 300. This will have your balance paid off by Feb. of 2012 versus just paying the minimum payment, which by the way always gets smaller…and having it take until December of 2028. (I can send you the excel sheet)
The second thing…find some extra money to apply. If you could find an extra $50 it would make a big difference. By paying $350, you would have it paid off by April 2011.
To recap:
Do what you doing = 2028
Pay $300 per month = 2012
Find another $50 to apply = 2011
Now the big question: Where do you find an extra $50 when the $300 is probably too tight for you? Right?
Contact me via email and I can send you some links to save on your:
Phone Bill
Cell Phone Bill
Internet
I can also show you some free business opportunities so you have no expense but potential to make a good second income. Last month, I made $600 with this and it looks like I will do it again this month.
I also have a link to credit cards with 0% interest if you qualify. The above $350 payment each month at 0% would have you free in August 2010.
Stop charging the card! Also, take a second job or sell things on Ebay!
Pay off the card with the highest interest first!
When you are stuck in debt, consider all the available options. You will need to work closely with experts who will provide right guidance to clear off your debts. Credit counseling agency is one such set of experts, equipped to fight debt.
Do a 0% balance transfer, freeze your credit cards (literally…in your freezer) and put as much of your money towards that credit card balance as you possibly can. Credit counseling may be a little ahead of the game…you may just want to read around on different financial sites that can help point you in the right direction.
first……how much are you paying for minimum payments for all the debt? I’m guessing it is less than $500. When you go to one of those credit counseling places, you will still have to pay quite a bit, it may even be close to $500 because you have a set amount of time you will have to get that paid off in. As it stands, if you pay minumum payments with on all of your debt, you’re probably looking at 20 years just to get them paid off. YIKES! So really, you have a few choices. FIRST: Pay minimum on all cards, except for one that you can get knocked off fairly quickly. Once that one card is knocked off, apply that payment plus whatever you were paying already, to another card. It’s a snowball effect, and it starts slow but eventually will pay off. SECOND: You could go to that credit place…….but again the payments might be similar to $500 a month since you have a time limit you have to use for going through there. Best thing may be to go to one of those places and just ask……..but i think it does ding your credit a bit. THIRD: get the loan, and get a 2nd job (maybe being a waitress). When you get the loan, you can get all those cards PAID OFF and it would be a huge burden lifted off your shoulders. You may have to bite the bullet! It is hard!!! Cut back on living expenses (easier said then done, i know). Be patient and weigh all the options. Maybe even better…..talk to someone that has financial wisdom and ask them what the best choice would be…..since they might be in your area and know what the circumstances around your issues would be. But keep in mind….you may be paying OVER 20% interest on all your cards,which may save you money with the loan! ALSO CUT UP YOUR CARDS! DO NOT cancel the accounts, just cut them up, and never use them! Once you are out of debt, get ONE card with a $500 limit for emergencies only. hope this helps! good luck
When using the credit card, people ignore the consequences of using the card too often. Frequent use of credit card causes bills to be accumulated and worsens your credit score. Besides lowering your credit score, you also face financial burden since the interest charged is very high.
check out dave ramsey site. stop charging pay extra and get a partime extra job just for credit cards.
Live in your means/
Dave ramsey helped me a lot