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my2sons
LIF Zygote
Member since 3/07 43 total posts
Name:
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Help me How to get out of debt
Trying to consolidate bills. Who could I use? Has anyone done this? I just cut all credit cards. Need to lower the rates.
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Posted 7/8/07 8:43 AM  |
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mommy2Alex
3 babies for me :)
Member since 5/05 6683 total posts
Name:
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Re: Help me How to get out of debt
I would start by calling the cc companies and asking for lower rates or if any are offering balance transfers at a low rate. Then I would apply for 0% interest cards and transfer as much as I could to those types cards. Paying the minimum on those balances and as much as I could afford on the higher rate cards.
I would also pay myself each time I got paid. I would figure a budget, how much I would need to pay cash for my gas, groceries and other incidentals. Then each time I got paid, I would withdraw that amount in cash and use it for purchases. If you have any $$ left over for the week, I would use it to pay down debt.
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| Posted 7/8/07 8:55 AM |
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charon54
My two boys!
Member since 5/05 7279 total posts
Name:
Rebecca
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Re: Help me How to get out of debt
My in-laws did a home equity and consolidated all of their debt into it. Granted they did not have that much credit cards, but the credit cards plus two car loans and their payment is under $300. Something to consider if your credit card rates are over 8% and you have decent credit and own your own home.
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| Posted 7/8/07 9:23 AM |
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VickiC
Rocking the party
Member since 5/05 4937 total posts
Name:
Vicki
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Re: Help me How to get out of debt
I would try to stay away from credit consolidating companies - I have heard nothing but horror stories about them. I would call each CC company to see if you could get the rate lowered and work something out.
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| Posted 7/8/07 9:53 AM |
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rojerono
Happiest.
Member since 8/06 13803 total posts
Name:
Jeannie
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Re: Help me How to get out of debt
You have taken the first step by eliminating credit card usage. That is FANTASTIC!
Definitely stay away from credit consolidation companies... most will hurt your score more than help it. My sister used to work for one of them back in the day. She called it a 'legal scam'.
I agree with the poster who spoke about a HELOC or Home Equity Loan. You still owe the money - but it is at a lower rate and much of the interest is tax deductible. Which is a HUGE help.
You can also call your CC companies and tell them that you would like them to consider lowering your interest rate. As long as you have a good payment history, they will usually give you something. I had our chase card lowered from 18% to 11%.
If you are organized, you can also become a credit card 'gamer'. You have to have a good credit score to do this. Basically you look for 'no interest'/'low' interest introductory rates on TRANSFERS. You transfer your balance from the high interest card to the no interest card and soon the old card will come back to you with a new and improved offer for transfers... you transfer funds back. This is a dangerous kind of situation and I would only suggest it if you have less than maybe 5K in outstanding cc debt. But it does work. My husband and I were both out of work after my oldest son was born and we literally LIVED on credit. We had one card. We got 2 more cards and split the balance between them at 0% interest. The original card came back with a no interest for 6 months offer just about when our 0% interest on one of the cards was expiring so we put everything back on that card. It enabled us to pay off the debt by paying into the principle only without worrying about accruing more debt in interest!
HTH!
ETA: One thing to remember about HELOC's They are great and useful and helpful. And for the first 10 years you will find that the payment is VERY low. The reason is that for that 10 year 'draw' period you are ONLY paying interest. You must start paying back on the principle after that 10 years...and that's when the payments can get hairy if you have borrowed more than you can handle!
Message edited 7/8/2007 10:31:05 AM.
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| Posted 7/8/07 10:28 AM |
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JenniferEver
The Disney Lady
Member since 5/05 18163 total posts
Name:
Jennifer
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Re: Help me How to get out of debt
You're definitely on the right track. Call the CC companaies. Ask if they can lower the rate. Offer to pay $X now and see if it helps. YOu can also threaten to take your business elsewhere. I transfered most of the balance of my highest interest rate card to a 0% card. Pay cards down with a plan. Play as much as you can on the card with the highest rate and only the minimum on the others. This doesn't sound like it makes a difference but with the high CC rates these days it helps you get out of debt faster.
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| Posted 7/8/07 10:33 AM |
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bklyngirl
COULD THIS BE MY YEAR??
Member since 6/05 15758 total posts
Name:
Gail
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Re: Help me How to get out of debt
Posted by VickiC
I would try to stay away from credit consolidating companies - I have heard nothing but horror stories about them. I would call each CC company to see if you could get the rate lowered and work something out.
i was with one. i had a great eexperience. it didn't ruin my credit
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| Posted 7/8/07 10:36 AM |
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charon54
My two boys!
Member since 5/05 7279 total posts
Name:
Rebecca
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Re: Help me How to get out of debt
If you are considering a Home Equity Line of credit you can leave it variable for a lower payment (but you will pay back no principal) or fix it in to pay the princpal and interest. My DH is a bank manager and can give you more info if you want to PM me. Just one of many options
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| Posted 7/8/07 11:39 AM |
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hazeleyes33
LIF Adult
Member since 5/05 13060 total posts
Name:
Ginger
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Re: Help me How to get out of debt
We just started a heloc too. We have cut our bills in half and we are able to save the money for things that we had charged before.
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| Posted 7/8/07 11:58 AM |
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charon54
My two boys!
Member since 5/05 7279 total posts
Name:
Rebecca
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Re: Help me How to get out of debt
Yep...people don't realize how much more comfortable you can live with the same amount of debt.
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| Posted 7/8/07 3:46 PM |
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my2sons
LIF Zygote
Member since 3/07 43 total posts
Name:
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Re: Help me How to get out of debt
What company did you use?
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| Posted 7/8/07 4:45 PM |
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hazeleyes33
LIF Adult
Member since 5/05 13060 total posts
Name:
Ginger
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Re: Help me How to get out of debt
Posted by my2sons
What company did you use?
Not sure if the post was for me but we used Chase and it was really easy.
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| Posted 7/8/07 4:59 PM |
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charon54
My two boys!
Member since 5/05 7279 total posts
Name:
Rebecca
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Re: Help me How to get out of debt
Both my IL's and I used WaMu. Had Chase but they charged $50 a year just to have the lline.
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| Posted 7/8/07 5:22 PM |
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Tine73
Member since 3/06 22093 total posts
Name:
*********
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Re: Help me How to get out of debt
Contrary to what a few above posters said about consolidating, I did it and it saved my life. Seriously! After college I lived like a rock star and it caught up with me.
I used this organization, CESI
They either got rid of all of my APRs or dramatically got them lowered and then I just sent them a monthly payment and i never had to worry about it. When I was finished paying it off, my credit was awesome.
Good luck!
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| Posted 7/8/07 7:28 PM |
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emilain
UNREAL!!!!!!!!
Member since 5/05 4457 total posts
Name:
Mama
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Re: Help me How to get out of debt
Posted by bklyngirl
Posted by VickiC
I would try to stay away from credit consolidating companies - I have heard nothing but horror stories about them. I would call each CC company to see if you could get the rate lowered and work something out.
i was with one. i had a great eexperience. it didn't ruin my credit
us too, they negotiated our debts for us (my husband was out of work due to surgery) and they cut it down to almost 1/2 I kid you not, for example, we wed Home Depot $2100 and they negotiatedit down to $850. It indeed affects your credit negatively for a brief time but it turns around wuick sinc eyou get out of debt quicker, our scores have only been affected a few points.
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| Posted 7/8/07 9:01 PM |
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Mommy2Boys
My Boys!!!!
Member since 6/06 14437 total posts
Name:
C
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Re: Help me How to get out of debt
But you can't take on anymore debt in the meantime which is what scares me? What if you need to use a credit card for something or buy a new car or I dont know something comes up and you dont have the cash??? Than your kind of stuck, right?
Message edited 7/8/2007 9:41:37 PM.
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| Posted 7/8/07 9:41 PM |
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emilain
UNREAL!!!!!!!!
Member since 5/05 4457 total posts
Name:
Mama
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Re: Help me How to get out of debt
Posted by jellybean1420
But you can't take on anymore debt in the meantime which is what scares me? What if you need to use a credit card for something or buy a new car or I dont know something comes up and you dont have the cash??? Than your kind of stuck, right?
no, we got a new car while doing our consolidation program.
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| Posted 7/8/07 10:13 PM |
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my2sons
LIF Zygote
Member since 3/07 43 total posts
Name:
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Re: Help me How to get out of debt
Thanks everyone. Glad to know I'm not the only one. I'm going to make some calls today.
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| Posted 7/9/07 7:39 AM |
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Beth
The Key to your new home....
Member since 2/06 24849 total posts
Name:
Beth
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Re: Help me How to get out of debt
Posted by emilain
Posted by jellybean1420
But you can't take on anymore debt in the meantime which is what scares me? What if you need to use a credit card for something or buy a new car or I dont know something comes up and you dont have the cash??? Than your kind of stuck, right?
no, we got a new car while doing our consolidation program.
you wont be able to get a mortgage or re-fi for 2 years if you are in one of those programs
and not all are good- some really mess up your credit bad
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| Posted 7/9/07 9:20 AM |
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HappyWife
LIF Toddler
Member since 12/06 484 total posts
Name:
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Re: Help me How to get out of debt
Posted by my2sons
What company did you use?
There are some great companies and some shady ones. Things to remember: never ever pay for credit consolidation services. There may be a voluntary/donation fee but it should be minimal and you should be able to opt out of it.
A credit consolidation company is good if you want the ease of having just one bill to pay every month. APRs will be lower and the monthly payment you make will be spread out between the various creditors.
It may not affect your credit (FICO) score b/c the score is calculated on a number of metrics of which enrollment in a credit consolidation plan is calculated. But it will be noted on your credit report that the account was closed and that there is a credit consolidator involved.
If you have the discipline, I would suggest making a list of all your debts and the APR and amount owed. Then go through the list and call each of the companies to negotiate a better rate.
Good luck!
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| Posted 7/9/07 11:39 AM |
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my2sons
LIF Zygote
Member since 3/07 43 total posts
Name:
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Re: Help me How to get out of debt
I talked to Chase we are looking into Heloc.
I know consolidation companies are shady that why I asked here. Thanks to all
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| Posted 7/9/07 1:59 PM |
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