Credit Card Debt Quick

We have about $15,000 in credit card debt and would like to pay it off in one year. Is this possible?

Yes, if you have the disposible income to do it.

No fast food, no eating out, no movies, no extras! Make a budget and stick to it. Write it down. Pay for your groceries and gas and other things that you need with cash. Stop making unnecessary trips to the store, save gas (it's $3 a gallon!) and don't buy expensive food at the store. Buy the store brand, shop the sales, eat spaghetti and hotdogs like a college student.

Pay at least twice the minimum payment on each card. Plan it out on a calculator:

http://cgi.money.cnn.com/tools/debtplann er/debtplanner.jsp

Pay off the highest interest card first, then take the money you were paying on that one and apply it to the next higher interest card and so on. Be sure to put some money in a savings account, even if it's just $20 a week, so that if there's an emergency and your car breaks down or something you have money saved and don't have to charge it to the credit cards.

After you pay them off you should not use them unless you have to charge something you can't pay for any other way, like a rental car. Save your money, have 3-6 months of living expenses in the bank, pay cash for things you want.

edit:

If you take out a home equity loan and charge the cards back up again and can't pay the equity loan back you can lose your home. People have fallen for that one. I would personally not take out a home equity loan, especially if you have the disposible income to pay the cards off if you just scrimp and save.

2007-12-05 18:12:33 by jacki0o0

www.letsforgetdebt.com - An excellent informative site and service to help anyone with credit card debt. A step by step video talking about the ...

See the following options to find the solution that is best for you:

~Credit Card Balance Transfer
A balance transfer is the simplest way to consolidate debts so you can find relief from numerous minimum payments that get you nowhere. If you decide to use a balance transfer, you must commit to paying more than the minimum on the new combined balance. To do this, total up all of the minimum payments on your previous debts. Now add an additional amount, whatever you can free up from your budget. Pay that entire amount to the new balance every month. With determination, you can probably pay off the entire balance before the interest rate offer expires.

~Credit Card Debt Consolidation
If you owe more debt than you can reasonably pay during the balance transfer offer period, you should consider a debt consolidation loan. These come in two forms: personal and home equity. If you don’t own a home or your home doesn’t have equity, then you should apply for a personal debt consolidation loan. Interest rates are higher than home loans, but lower than credit card rates.

~Credit Counseling
If you need help paying off your credit card debts, contact a local credit counseling service. The service will review your debts, income, and expenses, and work with you to create a payment plan. They may suggest a debt management plan. The service negotiates with your creditors to reduce your interest rates and set a fixed monthly payment. Once your debts are enrolled in the program, you no longer have access to the cards, which prevents you from creating new debt. In addition, you make a single monthly payment to the service, which then distributes it to your creditors as agreed.

~Credit Card Debt Settlement
If you owe significantly more than you can pay, and can’t reduce expenses or increase your income any further, a credit counseling service may recommend debt settlement. Also called debt negotiation, debt settlement actually reduces your total balance due. The service contacts your creditors to negotiate a new lower balance and a new payment plan. You may either be required to make a lump sum payment or monthly payments. In most cases, debts can be reduced by 40%. Before choosing this option, remember that debt settlement may damage your credit and you may owe taxes on the unpaid amount.

2009-03-24 16:05:03 by ~DANNY'S WIFEY~

Now what? I work two jobs now and have been trying as hard as I can to keep my head above water. Single parent and the son just finished vocational school. I am guessing I have to get a lawyer and look into debit re-organization or bankruptcy now? Are these my only options now? Just mortified by all this.
There is no way I would choose bankruptcy if there is any way else out of this. Please do not assume so. I own my own business and have worked very, very hard for 20 years. I ran into some health problems and lost a very large account, add in the cost of secondary education of my son and a few unexpected major issues with vehicle repairs and need for furnace - simply a small run of bad luck and a few poor financial choices and now I am in trouble. I have tried talking to the credit card company and when the interest went from 9% to 18%, I continued to pay on time monthly. When the interest then went to 30% because I missed two payments in a row, I was immediately screwed. An expected $150 a month payment because $400 a month. Credit score has gone from 780 to 550 because I got behind trying to keep up w/ the higher interest. Please do not assume that my desire is to push my debt off on society. I will do everything in my power to not make that happen.

Call the credit card company and see if they are willing to settle the debt for some portion of the debt. I have seen people that owed $10,000 settle for $4000. It is a big black mark on your credit, but it sounds like your credit is bad anyway.

Many credit card companies realize that when you are about to default on their debt, you are on others also. If they can get any money out of you they will because they realize if you file bankruptcy, they will get nothing.

One final note. It is vitally IMPORTANT that you get the settlement agreement in writing before giving them the money. If you don't have the agreement, there is nothing to prevent them from claiming it is just a payment on the full debt not a settlement. That is wrong, but credit card companies and collectors are known for using illegal and immoral collection tactics...

2007-08-06 07:34:46 by dede_mcm

We have 3 credit cards, all maxed to and over the limit. I am consulting a credit counseling service but my husband doesn't want it to ruin our credit. I personally think it will get us out of debt A LOT quicker and we're not filing bankruptcy. It may give us a blemish on our credit. But I think it's worth it.

Be careful with so-called credit repair businesses. Many are a rip-off and charge you to virtually nothing. You can do better contacting the credit card company yourself and work out payment terms.

2006-05-23 19:49:17 by animalover

I currently have around US $4,500 in credit card debt, spread over three separate cards. I have US $1,300 in savings and I earn anywhere between US $2,000 and $3,000 each month.

I have zero expenses.

My question is, how do I pay off my credit card debt as quickly as possible whilst also building on my savings?

Any advice would be GREATLY appreciated!!

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. 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.

2009-06-16 14:15:21 by AeF