I have a little less than 10,000 credit card debt that I am trying to get rid of it. I haven’t used any of the cards in over a year. It is a total of four cards that rage from 20%-25% in APR. I have never missed a payment or have been late but it seems like I will never pay them off. I always pay more than the minimum payment also. Recently I have been getting alot of offers for credit cards with 10% and 12% APRs. I was wondering if there was a loan that I would be able to get with lower interest rates to pay off those credit cards and close them out, and I just pay the loan off in the amount of time agreed. For example such as an auto loan or home loan where you know you pay a certain amount and in so many years you are done. With these cards it seems like there is no end in sight. I don’t have any collateral either. I was wondering if anyone knew of any programs out there that might be able to help me. Here are some other expenses that I have every month.After taxes I bring home $2000-$2300 a month
$800 House Note
$70 Car insurance
$50 Truck Insurance
$109 Student Loan Payment
$400 Child daycare expenses
Capital one Card about $2200.00 owed 22% APR
Chase about $1800 owed 21%APR
Best Buy Card about $1700 owed 22% Apr
Macys Card about $1000 owed 25% Apr
Just looking for some advice. Thanks
I asked same question a few days ago. I’m just looking to see if there are any other suggestions out there that might help me.
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You gave your gross and monthly nut – but didn’t give us an idea of how much you are paying these debts down – then what can we do to help you – The only advice I can offer is to 1) keep paying a little extra on each every month or 2) get a refi on your home – check your interest rate – it may pay to refi now – but if you can get some equity out of house – remember you’ll be paying for 30 years or whatever your new mortgage is written for! If your credit is any good – maybe you should try to find a really cheap new credit card like you said 9% or 10% – there are offers out – usually for 1 year – few and far between but you must try to find them.
There’s no magic bullet. If you don’t mind getting your credit tarnished then you can probably deal with one of the many debt negotiators.
Call each credit card and see if they will lower your rate. They just might.
Pay as much as you can to the highest rate card first. Pay it off and take all that money and pay off the next highest card and so on.
If you have a 401k consider taking a loan against it to pay off as many cards as you can.
Unfortunately, you are not alone with debt balances. Besides, with the recent state of the economy, things are difficult and individuals have huge amounts of debt, including the US Gov! There are several consolidation services out thereeto help, you may want to take a look at them.
I’d start with a budget and take a targeted approach to paying off the debt. Check out DaveRamsey.com for personal finance advice and Mint.com for budgeting. Talk to your bank about a debt repayment/personal loan or a second mortgage; check out the terms and make sure it saves you money and fits your monthly budget before applying.
Balance transfers to those new card offers may or may not help. Read the terms of the balance transfer and make sure it’s going to save you money. Most charge a flat fee of 3-4%. Plus, some of them offer 0% interest for a specified period of time, afterwhich they charge a high interest rate or back-charge interest from the date of transfer. If you are confident you can pay off the balance before that period ends and the flat charge is less than the interest on your current card for that period of time, it’s a good deal. Otherwise, keep your debt where it is. Also, if the maximum balance transfer amount is less than the balance of the current card, you’ll have two minimum monthly payments going forward.
There are two schools of thought on how to pay off debt: 1) the highest interest 2) the lowest balance. Paying the highest interest debts will save money in the long run. Paying the lowest balance account will reduce the number of accounts owed and free up those payments for other debts sooner. Decide which account to focus on; make the minimum payments to other debts and put all extra payments toward that one. Once that account is paid, take the money you were paying to it each month and put it toward the second one on your hit list. Start with the Macy’s card since it has the lowest balance and the highest interest rate. You didn’t mention the details of the student loan; is it fixed or variable interest? If variable, your monthly payments could go up when interest rates increase.
You mention a car and a truck; do you need both? If not, sell one and put that money toward paying down the debt. Have you shopped around for lower car/truck insurance? You may get a better deal at another insurer. Consider putting enough in savings to cover a higher deductible to save on the monthly cost – increasing the deductible without money to pay for it could result in a worse situation if you get in an accident. Does your insurer (or future insurer) offer a discount for paying the policy up front instead of monthly payments?
Are there any other bills you’re paying that you don’t need or could get cheaper elsewhere? It’s difficult to determine what’s a need vs. a want. With every purchase ask yourself if you can wait to buy it, if you really need it and if you can get it cheaper elsewhere. Every dollar wasted on something frivolous equals more than a dollar in terms of your debt due to compound interest.
I answered your question earlier. The big issue here is the interest rates….these are killer interest rates that will make paying off this debt very hard given your already tight budget as outlined below. Credit card companies are brutal and they really are not in the mood to lower their rates. There is only 2 ways to do this without filing for bankruptcy:
- get another card with a lower intro rate and balance transfer the debt to this new card with the lower rate. You will need to have good credit to qualify for this. If you take this step, when you balance transfer the debts to the new cards and your old cards have zero balances, contact the other cards and request voluntarily credit limit reductions to $500…otherwise the temptation is too great to start using all that credit again and you could quickly be in twice as much debt as when you started.
- If this cannot work, then the only other option without filing for bankruptcy is to enter into a non profit debt management plan on the credit card debt…they can cut your interest down to about 10%…which would help you a lot. With this program, you have to cut up all your cards and you have to stop using all credit. You can get a referral at: http://www.nfcc.org/
- The Dave Ramsey advise as mention above is not going too help much when all your cards are at sky high interest rates.
http://debtreliefreviews.net/top-debt-consolidation-companies/ has several ways to get rid of credit card debt.