Credit Card Debt Options

I own my home, but do not have enough equity built to refinance and get $50K to pay off credit card debt-what are my options? Someone told me a second mortgage may work, but I have only owned my home for 14 months. Balance on my current mortgage is $77K, home value is max $90K.

You can't borrow your way out of debt. Try and locate a lower interest credit card and transfer your balance. Some accounts have 0 transfer fees and maybe 0 interest or low introductory interest for the first few months. If you have that little grace period you need to pay as much as you possibly can right away and lower that principal amount. Scrimp and save, cut coupons, brown bag your lunch, get a roommate, whatever it takes to start paying down that debt. That is a huge amount of money if you are paying 18%--your interest alone is probably a couple of hundred every money and if you are only paying the minimum you aren't making a dent in the actual debt.

You have my sympathies. I was in debt for a long time and it took a long time to get that debt monkey off my back. Now that it is, I drive a 14 year old car and think carefully about anything I will owe on for more than a few months. It is enormously freeing not to be in debt. You have so many options and you sleep better. Good luck!

2007-06-14 10:49:02 by KarenB

During these challenging economic times, millions of Americans are struggling with credit card debt. Finding an effective solution to resolving ...

I have credit card debt and this time it is hard for me to manage it. Do I have some kind of options to deal with credit card companies to have some break or if they can write off part of it without affecting my good credit? If requested, can they defer the monthly payments? But whatever is negotiated, I don't want to mess up my credit. Any viable solution please.

You sound like you are doing fine. They are not calling you at home or threatening to send you to collections.

You need a plan so you can pay off all these cards. Start today. Pay off the one that you are paying the most interest on. Not the highest interest rate - but what you are paying the most interest / month on.

It is wonderful to live debt free. I love my credit cards and have paid them in full each month. They help me budget my groceries and gas. I have never paid a penny interest.

Use credit cards for the rewards and cash back, don't let them use you. Pay them in full - start your plan today.

Only 40% of the population carries a balance - funny thing is 40% of people are considered by the goverment to be in poverty.
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2008-11-14 06:07:15 by wcb

Price: $2.99

I have maxed one of my credit cards ($2000). I work full time so I can pay it back over time, but the thought of having that debt on my credit card scares me a little. The minimum payments are $25 a month, but I pay more than that. I also have a car loan and was wondering if maybe I could take out a personal loan, consolidate both and pay one repayment a week. What advice do you have for me?

Please do not consolidate. 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. There is a better way.

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. The holidays are coming and there will be plenty of temporary jobs available. It is better to have a no fun year or two than a no fun decade.
If you make only $500 per month at the part time job, that will pay off your credit card in about 4 months and then you can pay off the car loan.

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:Mimimum 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.

2008-10-23 00:21:50 by Tia

I am being sued for some old credit card debt, about 2,000. My hearing is three weeks away. I have absolutely no money to pay. What options do I have? What can I do? Please help!

Well first of all, DO NOT file bankruptcy. You will wind up paying money and you may not qualify anyways.

Second: Is this a hearing for arbitration? this is different then going to court. Only the Original Creditor (the bank) can use arbitration. IF it is some collection agency (third party) attempting to collect, then the rules have changed. 3rd parties fall under the FDCPA.

You should check your states statute of limitations to see if this debt is time barred (past the SOL). Use this link to find your states SOL

http://www.bcsalliance.com/statute_of_li mitations_on_debt.html

If it is time barred, then they can not seek legal action. DO NOT agree to any payment plan or make any payments as this will reset your states SOL and then they can seek legal action.

Did you receive a court summons? or just a letter stating there would be a hearing?

If it is a court summons, it will show what court it is being held at and the court docket number. Contact the court to verify if it is indeed a legal summons. If it is then there is another step you can take to stall them and give you time and in some cases, a chance at reaching a settlement out of court.

You have 2 options: one being request "validation" of the debt from the creditor (not verification, there is a difference) but only if this is the first notice you have of the debt. If they sent you a letter before and you did not ask for a validation and ignored them, then it is too late.

Your other option is to file a "sworn denial" with the court and the creditor (this applies to either the original creditor or a third party collection agency).
You can ask the court clerk about this. Some courts have the form available and will explain what you need to do. This changes the dynamics of the case and puts them in the hot seat.

Hope this answer is of help to you
LEGAL DISCLAIMER: The answer provided here is intended for informational purposes only. It is not intended nor presumed to be legal counsel or professional legal advice

2008-12-20 23:48:55 by shoes101

I owe but can not pay right now and am being sued. What are the options to postpone until I can sell my home?

Legally there are none. There is no law that allows you to ONLY be sued with it is convenient to you. If that were possible, NO ONE would EVER get sued!! You just have to pay it off after you sell the house and after judgmentnt has been issued against you.

2009-12-02 08:59:04 by Baily