Can Card Credit Debt Eliminate

i am having a very difficult time paying down the balances that I owe on my credit cards. I've tried calling them up myself and negotiating the interest rate, but they refuse to lower it. I can barely afford the minimum payments and just want to be done with this. I don't want to file for bankruptcy, I'm just looking for other methods of helping me eliminate this debt that I carry. Any help would be greatly appreciated!

I, personally, think that debt settlement or a debt consolidation loan is not a great idea. If you have an income, this plan will work for you. Just follow the steps.
Please do not consolidate or use a debt reduction company . It is not free, they will lower your payments by increasing the length of time until you are debt free, and you will take a hit on your credit score. Or they negotiate your debt down after telling you not to pay for awhile adding another hit to your credit score. Student loans are the only debt that can garnish your wages for non payment without taking you to court first. Just list them out on a piece of paper or a spreadsheet and follow the plan. If you work the plan, the plan will work for you.

A. Have a garage sale and sell anything that you no longer need or want.

B.Get a temporary part time job, if you have one, get another.


Here is a plan that can help you. If you work the plan, the plan will work for you:
1. Make a budget. Make the budget a week before you get paid. A budget is not a punishment! It is a tool which will free you from ever having to worry about money again. Put everything in your budget. Especially those annual, biannual, or quarterly bills like car registration, insurance, etc. Give every dollar you are going to bring home the name of where it is going. Add an "emergency fund" category to your budget for 25 dollars and save up until you have 1000-1250 dollars. Your emergency fund will help keep you from getting into new debt because of an emergency. If you can, set up a direct transfer to a savings account for your emergency fund. That way it moves automatically and you don't even have to worry about it. You must cut your spending and live on less than you make.

2.First get current on all of you debts and make no more late payments. Stop using your credit cards immediately. Do not take on any more debt. Credit cards are like quicksand only the death is much slower. Make a list of all of your debts in order of highest interest rate to lowest interest. Use cash only for your spending from now on.

3.Pay the minimum due on all of your debts and then put your extra money towards paying off the highest interest one first. After you get that one paid off, you put the money you were paying on debt #1 (the minimum payment and the extra payment) towards debt #2. That will pay debt #2 off faster. When that is paid off, you put all three payments towards card #3 and that one will be paid off pretty quickly. As an example:

To start :
Debt #1 (highest interest): minimum payment+ extra payment
Debt #2 (middle interest): minimum payment
Debt #3(lowest interest): minimum payment

Debt #1: paid off
Debt #2: minimum payment from Debt #1+ Minimum payment from Debt #2 +extra payment
Debt #3: minimum payment

Debt #1: paid off
Debt #2: paid off
Debt #3:Minimum payment from card #1+ minimum payment from Debt #2+ minimum payment from Debt #3+ extra payment.

That way, you will get them all paid off, on time, and pay the least interest. It will also help towards rebuilding your credit since you will no longer have any late payments. This works no matter how many different debts you may have.

4. After you get all of your debts paid off, add to your emergency fund until you have 6-12 months of income saved up. Put that emergency fund money into a liquid money market fund or into a Bank of America no-risk CD so that if you need the money you can take it out without penalty.

5a. When you have your emergency fund in place, add a category for "fun" to your budget. Save for a holiday, a vacation, a big screen, or dinners out, whatever goal you want. Remember to enjoy your life.

5b. When you have your emergency fund in place, start saving for your retirement. Join the 401(k) plan at work and contribute the maximum. Your employer probably matches at least part of your contribution so why give up free money? Open a Roth IRA and contribute the maximum on a monthly basis. If you start saving for your retirement now, you will probably retire a millionaire.

5c. When you have your emergency fund in place, start saving for your next car. Only buy cars, or other things that depreciate, with cash. Save up for a nicer car. That way you get the interest instead of paying the interest.

You can do it and it isn't as hard as you think. Just follow the plan.

2010-01-21 16:22:52 by mike

debtrelief911.com - Get Rid of Credit Card Debt Now! Learn How to Eliminate Your Credit Card Debts in 90 Days Without Debt Consolidation or ...

Can an individual eliminate credit card debt by declaring bankruptcy? I didn't think you could wipe it out, just get the bill collectors off your back. But, someone told me that it depends on which chapter of bankruptcy you use. The right one WILL eliminate credit card debt. I know someone who has $80,000 in credit card debt and they are trying to do that to get rid of that debt! Is it really possible? Are there any restrictions in doing this. Can you ever get a credit card again if you do it?
If you file bankruptcy to eliminate all debt, do you have to give up ALL of your possessions? Will you have anything left?
This is for a friend of mine (really). They don't own a home. They have 2 cars and some furniture and A 401k plan. Between the two of them they make about $40,000 a year. I don't see how debt consolidation will help them How could they EVER pay off $80,000!?! They had a house but they used up all the equity in it over the years and sold it recently and broke even on the deal, ending up with NOTHING! What a mess! I just didn't think they could wipe out their credit card debt! And, it really isn't fair to the rest of us that pay our bills!

There are a number of factors involved.

A chapter 13 is where you have to pay back some of the debt. How much depends on what your current disposable income is and how much your debts total. There is a fairly complicate formula involved. But this will stop them from filing judgments, garnishments or liens. It freezes interest and late fees. And it protect your property if you own a home or car.

A chapter 7 is called "liquidation" for a reason. You may have to give up most of your property. Therefore, if you have a lot of property along with that 80k in credit card debts, you may have trouble keeping it all.

Also, you must pass a "means test". This was put into place to prevent someone who has a very good job from filing BK and dodging their debts. If you earn (generally) over $45k a year you will not qualify for Chapter 7. Again..there is a complicated formula to figure this out.

There are a lot of bankruptcy lawyers who have a free consultation. If you think it's necessary talk your situation over with them.

2007-08-10 16:49:17 by ol_skater_boy

I took a loan out a few years ago to help my girlfriend get out of some financial trouble and it worked out great. I paid myself back with interest. Now I want to do the same for myself, and I hear people saying NOT to do it? If it helps me out, as I cut up my cards in the process so they can't be used, why is it so bad?

The main reason is because your money is not working for you in your 401K if you take it out in the form of a loan. With the market down right now, you have to redeem more shares to get the same amount of money you could take out a year ago. By the time you pay back the loan, the market might be higher, so you could be buying back your shares for a higher price.

A second reason was already pointed out to you in the previous answer. If you lost your job, the loan would become due immediately. And, if you could not pay it back all at once, you would have a premature distribution on your hands, subject to regular income tax plus a 10% penalty.

A third reason is that you might not learn how to change your spending habits, and once you pay off the credit cards with the 401K loan, you might end up running up those balances again. This is what happens to about 90% of folks who pay off their credit cards with home equity loans, so why would a 401K loan be any different?

It would be a better financial lesson for you to feel the pain of paying down your credit card balances from discretionary funds, leaving your 401K intact. It will take longer and be more difficult, and that makes it more likely you will learn a valuable financial lesson.

Whatever you decide, good luck to you! Wishing you every financial success.

2009-04-19 20:21:47 by Cursed

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creating a new contract to replace the first
A Novation is a new agreement and is recognized in the law. The definition of Novation from Bouvier’s 1856 law dictionary illustrates:


NOVATION, civil law. 1. Novation is a substitution of a new for an old debt. The old debt is extinguished by the new one contracted in its stead; a novation may be made in three different ways, which form three distinct kinds of novations.

2. , The first takes place, without the intervention of any new person, where a debtor contracts a new engagement with his creditor, in consideration of being liberated from the former. This kind has no appropriate name, and is called a novation generally.



Your Novation Contract substitutes a new debt (zero) and a new engagement for the one claimed by the credit card company.



EVERY credit card company uses the novation contract process. Any time you get a Notice of an update to the terms and conditions of your credit card agreement, this update is in fact an offer to enter into a novation contract (a new agreement). When you use the credit card after receiving the new update, you have agreed to the new terms. Your act of using the card is an acceptance of the new agreement. How else could they change your credit card agreement? Insurance companies use this also, such as when you have a claim for $20,000 for damage and they send you $3,000.



YOUR CARD DISPUTE AND NOVATION

You can use the same process to enter into a new agreement with a card company, under your terms and conditions, by making the company an offer, which it can accept with an act. Simply, you send the card company a check for some amount, say $25, with the stated condition that by accepting the check, it agrees to your new terms and conditions (your Novation Contract). When the card company accepts the check by cashing it, it has agreed to your new Novation Contract. And you eliminate credit card debt in a simple, legal procedure. Get out of debt by using their law to your advantage.



Your notice of debt dispute and Novation Contract is designed to do the following:


(1) Bind your credit card company to the terms and conditions of your Novation Contract which include but are not limited to:

a) the cancellation of any and all prior in-force agreements;

b) its admission that the debt and all prior agreements are now paid in full;

c) its waiver of all claimed right of arbitration against you;

d) its obligation to report the account in dispute as “paid as agreed” to credit reporting agencies;

e) its agreement to not take any collection activity against you and to inform any assignees of the account that it has agreed that the account is “paid as agreed”;

f) the requirement that it verify under oath the amount of debt you allegedly owe in any correspondence to you; and

g) its agreement that any breach of the terms of the Novation Contract by them will injure and damage you and that it will be liable for all damages;

(2) Upon notice, bind any and all collection agents of your credit card company and third party collection companies to your Novation Contract;.


(3) Establish a legal basis for a claim of zero liability for the disputed credit card account;

(4) Establish a legal basis for declaring invalid any and all allegations of debt made against you that are associated with the credit card account and sent through the U.S. mails;



(5) Establish a legal basis for claiming injuries and damages should the credit card company or any collection agency breach the terms and conditions of your Novation Contract; and,


(6) Destroy any legal basis for the credit card company or any collection agent to ignore your card dispute and Novation Contract by your:

a) choosing and using a procedure permitted and recognized by contract common law, the Uniform Commercial Code, the Fair Debt Collection Practices Act, and the Fair Credit Reporting Act;

b) establishing the card company’s obligation and third party collector’s obligation to verify under oath the amount of any debt they allege you owe;

c) removing any controversy between your demand for verification of any alleged debt and any and all presentments by third parties containing unverified allegations of debt against you; and,

d) removing any presumption that you willfully avoided a known debt.

They are not stupid. They will not accept a check that you send "with the stated condition that by accepting the check, it agrees to your new terms and conditions (your Novation Contract)." When the card company rejects the check by not cashing it, it has reject to your new Novation Contract, and it will charge you a late fee because of your failure to send a check without conditions. And they keep you in credit card debt in a simple, legal procedure.

2010-01-20 20:23:36 by MR. Thumbs Up

I live paycheck to paycheck, if i could knock out some credit card debt I would have more money to do the things I want. What is that fastest way to knock some of my debt down, so that I can actually save some money and enjoy life a little more?

My wife and I were in the same position and got sick of it. We make a good income but had nothing to show for it. We not only wanted to get out of debt, but really have a firm personal financial plan so that when we are ready to retire, we can walk out the door with a truck load of cash. Getting out of debt and staying out of debt is just one step (the most important one) to a good financial life. Please read a book called the Total Money Makeover by Dave Ramsey before you do anything. If you read it, I guarantee you will be stunned at all the dumb things you have done with money over the years. I read it and I felt like someone hit me in the face with a bat by the time I was done. This is a very sound, logical plan that works. It is nothing tricky. It is nothing extravagant, just stuff your grandmother would tell you to do that most of us have forgotten. You have to live on less than you make. Plain and simple huh? Stop using debt. Pay cash for everything or use a debit card. Do not buy useless things you don't need in the first place. Don't bu stuff you can't afford, with money you don't have to impress people that you don't really care about. Get on a strict budget and stay there. Once you see how much money you bring in versus how much goes out on paper in front of your eyes, you will be blown away. Squeeze your budget to the point of choking it to death. Every extra dollar your squeeze out, send it directly to the debts and kill the debt as quickly as possible. No restaurants, bars, movies, vacations, etc until the mess is cleaned up. You will have to learn to say no to yourself and your friends.
Now this program is not easy. The hardest part is changing yourself. Money management is 20% head knowledge and 80% behavior. You have to change your attitude and behaviors in order to win. Like I said, the debt elimination portion of this is just one step in 7. Actually debt elimination is step 2. Step one is getting a $1000 emergency fund set up. This is just for emergencies only. Dinner out with friends is not an emergency. You just need to do a budget and get yourself organized. Most people do not do a budget and most of them are broke. Not really a very difficult parallel to draw here. The steps after debt elimination are to save up a full emergency fund of 3 to 6 months of expenses. Then it moves on to investing 15% of income, saving for kids college, paying off house and investing fully for retirement and the like. See, debt elimination is all part of a master plan. My wife and I have been on the plan since Nov. 08. We have not used a credit card since then and don't need one. We do not spend money on dumb stuff we don't need. We could take a first class, 2 week trip to hawaii with all the money we spent on DVD's that are now in a box collecting dust in the basement. We have paid off 2 car notes and a credit card note along with or ever reducing mortgage amount. We have gotten about 20k of debt out of our lives in 10 months just by getting organized and not spending on useless crap. The biggest key is the budget. You have to tell your money where to go and not wonder where it went. Do you know where every dollar is going and how you are going to spend it next month or are you just praying that there is enough money left in the checking account to cover all the bills? Just thought I would ask.
Read the book and get a solid plan. Nothing great was ever built without a plan. It is not difficult. It takes patience and self discipline. You need to get mad at yourself enough to change how you are doing things. Where do you want to be 5 years from now? In the same situation your in now or no debt and saving for a house or retirement? The old saying is the trip of 1000 miles begins with the first step. You have realized you have a problem. The other old saying is that 90% of fixing a problem is realizing you have one in the first place. You've come 90% take the other 10% trip. Read the book, get a plan and win with personal finance. You will retire very well off. That is the end goal. Not where you are going to eat next week. It has worked exceptionally well for my wife and I. Please,Please, Please do yourself the biggest favor in life and get you financial house in order. There is nothing more important than that in the long run. Quit living paycheck to paycheck and start accumulating real wealth. If we can do it anyone can.
Good Luck. I wish you all the best.

2009-09-11 07:09:55 by BW