Comments for Debt Blues

Comment on I have $7000 in credit card debt, should I go to a debt consolidator? by homeschoolmom

homeschoolmom — Wed, 09 Jun 2010 05:30:54 +0000

Here’s the plan (and you won’t need any debt consolidation help for this):
1). List your debts, from the smallest balance to the largest, along with minimum payment.

2). Pay the minimum on everything except the smallest debt and pay as much as you can on this until it’s paid off.

3). When debt #1 is paid off, take the amount you WERE paying them and ADD it to debt #2, so that your total debt reduction payment stays the same.

4). Keep going until they’re all paid off, then take that same amount and put it in savings every month for your down payment.

The difference in interest between paying the smallest debt first and paying the highest interest rate first is so small, it won’t matter in the end.

Comment on I have $7000 in credit card debt, should I go to a debt consolidator? by PAwatcher

PAwatcher — Wed, 09 Jun 2010 04:42:13 +0000

You don’t say if you have equity in a home to use for a loan. If so, you would be wise to use this way to consolidate. Otherwise, you may be able to contact each credit card and negotiate your interest rate. Try to get it lowered and then try to pay more than the minimum payment as you say you’ve been doing. Good luck.

Comment on I have $7000 in credit card debt, should I go to a debt consolidator? by kcbrown1979

kcbrown1979 — Wed, 09 Jun 2010 04:11:29 +0000

I have tried Debt consolidation which closed all my accounts leaving the balance which really hurt my credit score. Cut up all of your credit cards so that you do not charge any more. If you can afford than minimum pay it. Try to pay off smallest card first and then use that money toward your larger cards as the balances are paid off. With Debt consolidating you have to make way more than the minimum payment but it does reduce your interest. If you can try to transfer balances to lower interest cards.

Comment on I have $7000 in credit card debt, should I go to a debt consolidator? by huh?

huh? — Wed, 09 Jun 2010 04:09:40 +0000

Could you possibly take out a loan from a bank for $7,000, initially paying a large chunk of it (say 1 or 2k)? Making loan payments on time (along with the first large chunk payment) would help your credit quite a bit and your debt would also be consolidated with a decent interest rate.

I’m not sure doing that is even possible, but I know that making loan payments on time tremendously helped my credit.

Comment on I have $7000 in credit card debt, should I go to a debt consolidator? by Life Insurance expert

Life Insurance expert — Wed, 09 Jun 2010 03:14:13 +0000

Base on your situation, consolidating your debt may not be a good choice. If you have over $10,000 in debt, then you should consolidate. If you are going to consolidate, I would use the saved money and apply most of it back to the principal and invest the rest. Primerica Financial Services is a good company that helps clients get out of debt and they do what I just explained to you. If you go to them, ask about the “SMART” loan, which the lender is Citicorp Trust Bank. http://www.primerica.com

If you are not going to consolidate, I would pay the minimum on the low interest credit cards and move the “free-up” money toward your high interest credit cards (I call it the “Debt Stacking” solution).

Comment on I have $7000 in credit card debt, should I go to a debt consolidator? by carpediem3000

carpediem3000 — Wed, 09 Jun 2010 02:19:39 +0000

I woudn’t recommend it. I work in Collections at a mortgage company. Paying more than the minimum monthly payment on time every month looks MUCH BETTER on your credit then consolidation. You should be very proud of yourself for that. You might try calling the cards with the low APR to see if you can transfer some or all of you balance(s) from the high APR cards. Even if it goes over your limit, they might allow you to. Consolidation will also terminate many opportunities for credit increases, new credit card offers, and many lenders will not extend credit to you until the program is complete. Lastly, $7000 of credit card debt really isn’t too bad. Yes it’s kinda high, but it’s not out of control (and these are the people who need consolidation services), especially since you are able to pay more than the minimum every month.

Comment on I have $7000 in credit card debt, should I go to a debt consolidator? by Smiddy

Smiddy — Wed, 09 Jun 2010 01:46:40 +0000

Absolutely. I strongly, strongly recommend taking some time and going through the Motley Fools workshop on getting out of debt. It’s free and it has very sound advice. Here’s some text I copied from it:

“….

Be especially wary of double-digit debt — credit cards and loans that charge 10% or more in annual interest. At this level, balances snowball quickly, and it’s tough to get a return on the borrowed money that beats this cost.

# Reduce the interest rate. Most credit cards charge anywhere from 16% to 20%, which is huge! But you can negotiate with your credit card company for a lower rate. Particularly if you’ve had any of your cards for a while, take advantage of being a faithful customer, and call them up to demand a lower rate. Shoot for 11% or 12%. You’d be surprised at how easy it is.

# Consolidate your debts. OK, so you know what the interest rates and outstanding balances are for each of your cards, and you’ve reduced the rate on at least some of them. Next, consider combining your debts onto one or two of your lowest rate cards, if you’ve got some credit room on them. (If you’re maxed out on those cards, then forget it.) Simply call your lender and ask how to transfer funds.
….. ”

Here’s the link: http://www.fool.com/seminars/capitalone/index.htm?sid=0001&lid=000&

Good luck!!

Comment on I have $7000 in credit card debt, should I go to a debt consolidator? by cassieopia75

cassieopia75 — Wed, 09 Jun 2010 00:49:23 +0000

I think it’s a good idea. But also, it would depend on your income, too. If you have a history of paying bills on time, you might be able to transfer the balances of the cards with high APRs to a card with lower APRs.

Comment on I have $7000 in credit card debt, should I go to a debt consolidator? by WyattEarp

WyattEarp — Tue, 08 Jun 2010 23:54:49 +0000

Yes you need to consolidate your debt and destroy those credit cards…arrange to see a consolidator soon if your concerned about your credit score.

good luck

Comment on Why is my very old credit card debt now being sent to city marshall for collections? by D J

D J — Tue, 08 Jun 2010 23:21:15 +0000

How old is very old? The people that contacted you could be a scavenger debt collector. The debt may be outside the legal status for anyone to collect it. The must send you a letter in writing stating the nature of the debt. If it is a valid debt they can take you to court. You need to find out if it is a valid debt. Check out you state laws on the age limits on collections at http://www.ncaa.org

If the debt is outside statute, write them a drop dead letter. Check out the information on dealing with debt collects at http://www.clarkhoward.com . Clark Howard is a nationally known Consumer Advocate Talk Show Host based in Atlanta.