Credit Card Debt Consolidation Plan

I am planning to consolidate about $4000 in credit card debt by personal loan. What are the best lenders to approach?

What keeps most people in debt is the fact that they keep spending more money than they make. They look at the "monthly payments" instead of the total debt loan that they are carrying. People need to stop spending now and concentrate on becoming debt free. 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

2010-02-25 22:50:05 by case2485

www.debtguru.com Free financial analysis to help you decide whether a credit card debt consolidation program would work for you. Check out our ...

I'm thinking of consolidating 3 credit cards totalling just under $15,000.
What can I expect? What's the longest term/lowest payment I can get for this amount of debt? Can I add a Secured loan to this consolidation (citifinancial)?
What's my best game plan?

Anything else I need to know?

When you have multiple credit cards with varying amounts of debt, credit card debt consolidation is a good choice. Consolidating your credit debt will allow you to make just one payment to a consolidator, instead of numerous smaller payments to multiple credit card companies. Frequently, you can also obtain a lower monthly payment.

2009-04-24 07:56:18 by SRL

Price: $4.99

How can I solve my credit card problem? I owe about 50,000 sgd from credit card company. I have bad credit and the banks wants me to pay minimum payment that I cannot afford monthly, or else they will seize my properties. I used to pay about 1,600 monthly, but the debt grows every month due to late payment, lawyer charge, interest etc. How can I get out of this mess, I am planning to borrow from money lender to consolidate the debt and then pay montly at lower interest. Is there such organisation that lends money for debt consolidation in singapore? I have been in contact with overseas money lender that is willing to lend 50,000 at 5% interest PA but I have to pay initial charge at 800. Are they trustworthy? I can hardly make ends meet now. Please help...

eric,
citibank offer loans over the net up to $$25k pretty much right away.
however with bad credit this is not possible.
if you don't have security to offer then private money is about the only option.
there are sharks here who will lend at 4% per month.
let me know where you are accesing the singapore money from and i'll take a look thru the terms with you.
pete

2006-11-05 09:07:48 by eric l

Sharon's advice is correct. One way to determine whether a credit counseling firm is legitimate is to select one that is accredited by the National Foundation for Credit Counseling or NFCC. I was a volunteer for many years for the local consumer credit counseling service, a non-profit credit counseling firm that is accredited by the NFCC.

Visit NFCC at www.nfcc.org or call them at 1-800-388-2227.

2008-11-10 18:48:00 by dee

I owe a lot of money on several credit cards and recently lost my job. I need some imput from people who have worked with the credit card companies on their own to get a debt repayment plan in place so that I can pay what I can afford till I get back on my feet without incuring more finance charges and late fees. What are my chances of getting the credit card companies to work with me on this if I try to do it on my own without going thru a debt consolidation company? I would like to hear from people who have done this on their own if possible.
Thanks.

Apparently you haven't tried to call them. Call them all...or see a loan company. It's all about creditworhtyness.
Big Hint. Pay down the highest rate first. Divy up income to all those on a prorated basis.

2009-04-25 15:46:01 by jomedeiros